A “substantial majority” of Federal Open Market Committee participants supported the decision to lower target range for the federal funds rate by 50 basis points during its most recent meeting in September, with some arguing the committee should have begun trimming rates during its previous meeting in July, according to the FOMC minutes released today.
The FOMC voted to lower the target range to 4.75%-5% during its September meeting. The minutes show that while most participants favored the cut, some felt there had been a case for a 25-basis point cut during the July meeting “and that data over the intermeeting period had provided further evidence that inflation was on a sustainable path toward 2% while the labor market continued to cool.”
A few participants instead favored a 25-basis point cut during the September meeting. Fed Governor Michelle Bowman has since said that she voted against the larger cut as she worried it may have sent the wrong message about the strength of the economy and caused the public to expect similar cuts in the future.
