Donald Trump, Inflation, Economic uncertainty - Why are US Fed policymakers worried?
inflation as their comments echo Fed chief Jerome Powell's call for caution. The US Fed policymakers, fresh from an interest rate cut this week, fleshed out on Friday the case for reducing borrowing costs more slowly next year as they assess progress in lowering inflation and the impact of tariffs and other policies promised by President-elect Donald Trump, Reuters reported.
San Francisco Fed President Mary Daly, who supported the U.S. central bank's decision on Wednesday to cut its benchmark overnight rate by a quarter of a percentage point to the 4.25 per cent-4.50 per cent range, and Cleveland Fed President Beth Hammack, who dissented against it, both said the meeting's outcome was a «close call.» Daly and two other Fed policymakers who spoke on Friday said they felt the central bank would likely resume its rate-cutting next year, but signaled they would take their time doing so now that, as Daly put it, the «recalibration phase» is over, as per Reuters report.
«We're in the next phase, and that next phase is really looking at the incoming information,» Daly said in an interview with Bloomberg Television.
The U.S. central bank cut rates by a total of 100 basis points in 2024, bringing monetary policy to a somewhat less restrictive stance as inflation fell from much higher levels earlier in the year and the labor market cooled. Fed policymakers' projections released on Wednesday showed most of them now see two quarter-percentage-point rate cuts in 2025, fewer than the 100 basis points they had forecast in
