Fed's Mousallem skeptical of further rate cuts

PANewsSep 22, 2025
#Macro
On September 22nd that according to Jinshi, Federal Reserve official Musallem expressed doubts about further interest rate cuts, contradicting the widespread financial market expectation that the Fed will continue to lower borrowing costs this year. Musallem said he supported a 25 basis point rate cut last week because he saw increased risks to the labor market. However, with inflation nearly a percentage point above the Fed's 2% target, further rate cuts could signal excessive complacency about rising prices. "If the public begins to doubt whether inflation can return to the 2% target, restoring price stability will become more difficult and could impose higher costs on the economy." Traders are betting that the Fed will cut interest rates by another 50 basis points at its two remaining meetings this year. His views also differ from those of new Fed Governor Milan, who opposed a smaller rate cut at last week's meeting and advocated for a larger one. [PANews]
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Fed's Mousallem skeptical of further rate cuts

PANewsSep 22, 2025
#Macro
On September 22nd that according to Jinshi, Federal Reserve official Musallem expressed doubts about further interest rate cuts, contradicting the widespread financial market expectation that the Fed will continue to lower borrowing costs this year. Musallem said he supported a 25 basis point rate cut last week because he saw increased risks to the labor market. However, with inflation nearly a percentage point above the Fed's 2% target, further rate cuts could signal excessive complacency about rising prices. "If the public begins to doubt whether inflation can return to the 2% target, restoring price stability will become more difficult and could impose higher costs on the economy." Traders are betting that the Fed will cut interest rates by another 50 basis points at its two remaining meetings this year. His views also differ from those of new Fed Governor Milan, who opposed a smaller rate cut at last week's meeting and advocated for a larger one. [PANews]
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