Fed Cuts Rate Amid Deep Committee Split

The Federal Reserve trimmed its policy rate by 25 basis points for a second straight meeting. The decision exposed deep divisions on the Federal Open Market Committee: Kansas City Fed President Jeffrey Schmid and regional presidents Lorie Logan and Beth Hammack opposed the cut, while Governor Stephen Miran favored a larger half-point reduction. Logan and Hammack argued that slower hiring has not produced a sharp rise in unemployment and therefore does not justify weakening the Fed’s anti-inflation stance, and Logan said she would be unlikely to support another cut in December without clearer disinflation. Chair Jerome Powell said a December cut is “not a foregone conclusion,” and markets sharply reduced the odds of further easing after the vote. The Fed’s move contrasts with other central banks — the Bank of Canada cut rates again but signaled an end to its easing cycle, while the ECB and BOJ held policy steady — leaving policymakers to debate whether to prioritize cooling inflation or supporting a cooling labor market ahead of December’s meeting amid tariff uncertainty and a possible U.S. government shutdown.