Particle.news
Download on the App Store
16 ARTICLES
·
2w ago

Fed Poised to Cut Rates as Divisions and Data Gaps Complicate December Call

Officials will decide with key reports delayed by the shutdown, raising the likelihood of public dissents.

Federal Reserve Chair Jerome Powell is set to preside over the US central bank's last monetary policy meeting of 2025 amid a divided board
Image
Jerome Powell, chairman of the Federal Reserve, during the Hoover Institution's George P. Shultz Memorial Lecture Series in Stanford, California, on Monday, Dec. 1, 2025.
Bank of Canada Governor Tiff Macklem waits to appear at the Finance committee in Parliament Hill in Ottawa, Wednesday, Nov 5, 2025. THE CANADIAN PRESS/Adrian Wyld

Overview

  • Futures price an 86%–90% chance of a 25-basis-point move to 3.50%–3.75% on Dec. 10, which would be a third consecutive cut.
  • Powell has highlighted “strongly differing views” on the committee, and several analysts say the outcome is a close call that could draw multiple dissents.
  • A government shutdown from Oct. 1 to Nov. 12 canceled full October jobs and CPI releases, leaving policymakers to weigh older data against signs of labor-market softening and inflation still above 2%.
  • The Fed will issue updated 2026 projections, and Powell’s press conference is expected to outline conditions for any further easing into early 2026, with markets currently assigning low odds to a January cut.
  • Leadership shifts and global spillovers remain in focus, with Kevin Hassett widely viewed as the likely next chair and other central banks set to decide this month as the RBA holds and the Bank of Canada signals a pause.