According to the minutes of the Monetary Policy Committee meeting US Federal ReserveThe members, despite their differences, decided in the end to move to reduce interest rates by half a percentage point, in an attempt to balance confidence between inflation in the country and concerns about the labor market.
According to the minutes released Wednesday, the move Federal The massive 50 basis point interest rate cut for the first time in more than four years came despite a division among members over the economic outlook in the United States.
Some Fed officials were hoping for a smaller rate cut, by a quarter of a percentage point, because they were sure that inflation was falling sustainably, but they were less concerned about weak jobs in the world’s largest economy.
The minutes revealed that in the end, only one member of the Federal Open Market Committee, Michelle Bowman, voted against the half-percentage-point cut, saying she would have preferred a quarter-point cut.
The minutes stated that some participants preferred to cut interest rates by 25 basis points at this meeting.
The minutes added: “Many participants noted that reducing 25 basis points would be consistent with a gradual path to ease monetary policy tightening, which would allow policymakers sufficient time to evaluate the degree of policy tightening as economic conditions develop.”
Since the meeting, economic indicators have shown that the labor market may be stronger than expected by officials who favored a 50 basis point move.
In September, nonfarm payrolls increased by 254,000 jobs, much more than expected, while the unemployment rate fell to 4.1 percent.
