On December 24th, the lineup of the Federal Reserve’s interest rate setting committee is about to change, and at the same time, rising inflation concerns have made central bank decisions more complex. The Federal Reserve lowered its benchmark policy rate by 25 basis points earlier this month and hinted at only two rate cuts in 2025. Chairman Jerome Powell has made it clear that the central bank is entering a new phase, and the pace of future interest rate cuts may be more gradual and depend on whether inflation falls. In addition to the seven members of the Federal Reserve Board and the President of the New York Fed, the presidents of 11 regional Federal Reserve banks will also take turns voting on interest rate decisions in the Federal Open Market Committee (FOMC). Bloomberg Economic Research predicts that there will be more divergence in the FOMC in 2025. It evaluated the voting members of the committee along the hawkish dovish spectrum and found that the opinion differences among FOMC voting members will intensify next year, with opinions scattered at both ends of the spectrum and less concentrated in the middle. (Bloomberg)
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