According to the minutes of the last meeting, some members of the central bank’s monetary committee considered that inflation remained too high.
Officials of the American Federal Reserve (Fed) seemed very divided on the pace of lowering the monetary institution’s rates that would be necessary during their last meeting, in mid-September, with some considering that inflation remained too high.
At the last Fed meeting, on September 11 and 12, “some participants considered that they would have preferred a cut of 25 basis points for this meeting, others assuring that they would have supported such a decision”, according to the minutes (minutes) of the Fed Monetary Committee (FOMC) published Wednesday.
At the end of the last meeting, the monetary institution lowered its rates by 50 basis points, bringing them to a range between 4.75% and 5%, after having maintained it for more than a year. between 5.25 and 5.50%.
“Several participants noted that a drop of 25 basis points would be in line with the pace of the economy’s gradual return to normal, and thus maintain room for maneuver for future decisions,” the account also underlines. rendered.
Nonetheless, FOMC members believed that “if the data kept pace as anticipated, with inflation returning toward the 2 percent target and the economy near full employment, it would surely be appropriate to keep policy in balance over the long term.” term”.
They also insisted that “the realignment of monetary policy should not be interpreted as evidence of a less favorable economic outlook.”
The latest data relating to inflation must be known on Thursday, with the publication of the CPI index, on which Americans’ retirement pensions are indexed.
The progression of the other index, PCE, which is favored by the Fed in its monetary policy decisions, has slowed significantly since its peak in 2022 and fell to 2.2% last August, coming very close to the target of 2% in the medium term provided for by the mandate of the American central bank.
As for the unemployment rate, it fell back to 4.1% in September, with job creation well above expectations, after rising to 4.3% in recent months, seeming to support the idea of a slowdown in the labor market.
The Fed remains cautious in the evolution of its monetary policy, regularly emphasizing that it remains primarily based on the evolution of macroeconomic data.
Markets generally expect a 25 basis point cut at the next meeting, scheduled for November 6-7, and then another of the same magnitude at the last meeting of the year, in mid-December, according to the CME monitoring tool, FedWatch.
