""A further reduction in the policy rate at the December meeting is not a foregone conclusion-far from it," Powell said during his post-meeting press conference. The Fed cut its benchmark interest rate by a quarter percentage point to a range of 3.75% to 4%, citing cooling labor conditions and still-elevated inflation. Powell described the decision as a "step toward a more neutral policy stance," but emphasized-as he does often-that there is "no risk-free path" forward."
""While inflation has fallen sharply from its 2022 highs, Powell noted that price pressures have recently picked up in goods categories, partly owing to higher tariffs. The Fed now sees near-term inflation risks tilted to the upside even as job market momentum fades. "Conditions in the labor market appear to be gradually cooling," he said, adding that "downside risks to employment have increased in recent months.""
""The Fed also announced plans to end the runoff of its balance sheet-ending what's called "quantitative tightening"-as of Dec. 1, after shrinking its securities holdings by $2.2 trillion over the past three and a half years. Powell said recent pressures in money markets indicate the system has reached "ample reserve" conditions. For now, Powell stressed, the Fed will stay data-dependent.""
The Federal Reserve cut its benchmark interest rate by 25 basis points to a 3.75%-4.00% range, citing cooling labor conditions and still-elevated inflation. Fed governors hold strongly differing views on future policy, with some fearing that further easing could reignite inflation while others worry that keeping policy too tight could deepen an economic slowdown. Near-term inflation risks have tilted to the upside, partly due to higher tariffs and rising goods price pressures, even as job-market momentum softens. The Fed will end balance-sheet runoff as of Dec. 1, citing ample reserve conditions, and will remain data-dependent.
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