The Federal Reserve’s meeting on Wednesday showed a divided opinion among central bankers, who voted to hold their key rate steady despite objections from two governors who argued in favor of cutting rates. The decision came after discussions about the state of the labor market and inflation, with policymakers noting rising threats to the economy that warranted monitoring.
According to the minutes released Wednesday, “participants generally pointed to risks to both sides of the Committee’s dual mandate, emphasizing upside risk to inflation and downside risk to employment.” However, a majority of participants judged the upside risk to inflation as the greater of these two risks, while others saw the downside risk to employment as more salient.
The decision was influenced by President Donald Trump’s tariffs, which raised uncertainty about the effects on inflation. The Fed has been targeting interest rates between 4.25%-4.5% since December, and this is the first time multiple governors have voted against a rate decision in over 30 years.
The meeting came amid an increasingly heated political backdrop, with officials expressing varying opinions on where they see the economy and policy headed. The Fed will need to carefully balance the risks of inflation and employment when making future decisions.
Chair Jerome Powell’s keynote address at the Jackson Hole symposium this week is expected to provide further insight into the Fed’s stance on rates and policy.
Source: https://www.cnbc.com/2025/08/20/fed-minutes-august-2025.html