The disinflationary process has stalled, and at the same time, under Republican control, multiple items of Congress will push inflation even higher.

At their December 2024 meeting, Fed officials debated persistent inflation and offered a range of views on where interest rates will be in 2025. Officials stressed that the Fed does not pre-set policy and needs to adjust based on economic data and the Trump administration's policies.

The minutes of the Fed meeting, released on Wednesday (January 8), mentioned that "participants expect inflation to continue to fall towards 2%, but they believe that recent higher-than-expected inflation data, as well as the impact of potential changes in trade and immigration policies, mean that this process may take longer than previously anticipated." Some participants felt that the anti-inflation process may have stalled for the time being, while others pointed to possible risks. ”

The Federal Open Market Committee (FOMC) lowered the target range for the federal funds rate by 25 basis points to 4.25%-4.5% for the third time in a row at its meeting on December 17-18 last year. Officials also signaled that the pace of future rate cuts will slow due to persistent inflation, the U.S. economy still growing, and fiscal policy uncertainty.

The disinflationary process has stalled, and at the same time, under Republican control, multiple items of Congress will push inflation even higher.

At their December 2024 meeting, Fed officials debated persistent inflation and offered a range of views on where interest rates will be in 2025. Officials stressed that the Fed does not pre-set policy and needs to adjust based on economic data and the Trump administration's policies.

The minutes of the Fed meeting, released on Wednesday (January 8), mentioned that "participants expect inflation to continue to fall towards 2%, but they believe that recent higher-than-expected inflation data, as well as the impact of potential changes in trade and immigration policies, mean that this process may take longer than previously anticipated." Some participants felt that the anti-inflation process may have stalled for the time being, while others pointed to possible risks. ”

The Federal Open Market Committee (FOMC) lowered the target range for the federal funds rate by 25 basis points to 4.25%-4.5% for the third time in a row at its meeting on December 17-18 last year. Officials also signaled that the pace of future rate cuts will slow due to persistent inflation, the U.S. economy still growing, and fiscal policy uncertainty.