Fed Officials Cast Doubt on December Rate Cut as Odds Slide

Federal Reserve officials are signaling hesitation about a potential rate cut at the December FOMC meeting, with concerns over inflation persisting above the 2% target. Atlanta Fed President Raphael Bostic and Minneapolis Fed President Neel Kashkari are among those wary of easing monetary policy too soon. Bostic has also announced his retirement effective February 2026.

Market expectations for a December rate cut have dwindled, with odds now at 53.6%, down sharply from 62.9% just a day prior. The lack of fresh labor market and inflation data due to the government shutdown has added to the uncertainty. September's CPI stood at 3%, with unemployment at 4.3%.

Wall Street Journal's Nick Timiraos notes that at least four voting Fed presidents are not actively pushing for a December cut, reflecting a cautious stance within the central bank. The debate centers on whether inflationary pressures have sufficiently cooled to warrant looser policy.