Fed Officials Back Rate-Cut Freeze as Inflation Woes Persist

Several Federal Reserve officials have signaled a willingness to pause interest-rate cuts at their upcoming policy meeting, citing a labor market that appears to be stabilizing and ongoing inflation pressures, Maria Eloisa Capurro reported for Bloomberg News.

The Fed is widely expected to leave its benchmark unchanged at its Jan. 27–28 meeting.

Five presidents of regional Fed banks, who in recent months have found themselves on opposite sides of the policy debate, indicated the U.S. central bank is now well positioned to wait for more data before acting again.

The Fed is widely expected to leave its benchmark unchanged at its Jan. 27–28 meeting, following rate cuts at each of its last three gatherings.

The comments follow reports over the last week showing the unemployment rate ticked down to 4.4% in December, halting a string of increases in previous months, and inflation data suggesting the Fed’s preferred measure may still be close to 3% — a full percentage point above its target.

“The most important thing facing us is we’ve got to get inflation back to 2%,” Chicago Fed President Austan Goolsbee said in an interview with CNBC, citing concerns from businesses across his district over rising costs and affordability.