Federal Reserve Officials Signal Gradual Rate Cuts Amid Mixed Economic Signals

Strong labor market data and rising inflation complicate the Federal Reserve's path to neutral interest rates.

U.S. employers added 227,000 jobs in November, reflecting a rebound from prior disruptions caused by strikes and storms.
Federal Reserve officials express cautious optimism about the labor market but emphasize the need to assess broader economic trends before further rate cuts.
Inflation data shows a slight uptick, with overall inflation rising to 2.6% and core inflation holding steady at 3.3%, raising concerns about persistent price pressures.
Cleveland Fed President Beth Hammack suggests that the current economic strength may limit room for aggressive rate cuts in December's meeting.
Chicago Fed President Austan Goolsbee anticipates gradual rate reductions over the next year, contingent on stable inflation and labor market conditions.