Fed meeting minutes reveal deep splits on December rate cut decision

Main Idea: Federal Reserve minutes show deep splits over December’s rate cut, with officials divided on whether weak jobs or stubborn inflation is the bigger risk.

Key Points:

• The Fed cut its key rate by a quarter point to about 3.6%, but the vote was unusually divided at 9-3.
• Some officials wanted no cut, while one wanted a larger half-point cut, showing how split the Fed is on the economy.
• The minutes say several officials supported the cut only with caution because they wanted more data after the government shutdown delayed key reports.
• Jerome Powell said the cut was made because the labor market may be weaker than the data shows, even as inflation stays above the Fed’s 2% target.