Federal Reserve officials all speak out with caution about excessive rate cuts

According to reports, on Friday local time, four Federal Reserve officials expressed concerns in different forms about the possibility of a rate cut this week and another cut in December. This explains why Federal Reserve Chairman Powell stated after the decision that a rate cut in December is not "set in stone." At the meeting on Wednesday, only Kansas City Federal Reserve President Schmid voted against the decision to cut rates by 25 basis points, citing concerns about inflation stickiness in his statement on Friday. Two other officials, Cleveland Federal Reserve President Mester and Dallas Federal Reserve President Kaplan, who do not have voting rights this year, also hinted that they would oppose a rate cut if they had the chance to vote. Mester explicitly expressed concerns that this rate cut deviates too much from the restrictive stance needed to contain inflation: "We must maintain a certain degree of restrictive policy to bring inflation back to target." While Atlanta Federal Reserve President Bostic, who also does not have voting rights this year, supported the 25 basis point rate cut, he emphasized that the premise is to ensure that the policy stance remains restrictive. Bostic especially pointed out that with stubborn inflation persisting in all areas of the economy, each rate cut will make the reasons for further easing less clear, as interest rates are gradually approaching the neutral level that effectively controls price increases.