Federal Reserve Governor Powell: Rate cut possible in December, but will depend on upcoming data

On Monday, November 4th, Federal Reserve Governor Cook stated that she considers there to be a possibility of a rate cut during the December Federal Reserve meeting. Nevertheless, the decision at that time will be based on information from various channels between now and then, particularly given the situation where the government shutdown has led to delays in the release of official data. Cook said, "Currently, risks are increasing on both sides of the dual mandate. Maintaining interest rates at an overly high level could increase the likelihood of a significant deterioration in the labor market. Conversely, a too large rate cut could result in the anchoring of inflation expectations." She further added, "It is quite a challenging task to provide an economic outlook speech at this moment." She mentioned that since the government shutdown on October 1st, the latest official data on employment, inflation, and economic growth have been unavailable. However, she emphasized that "We are not acting blindly." Decision-makers and staff are actively reviewing various available administrative data, private-sector data, and the results of multiple surveys conducted by the Federal Reserve on businesses and households. These data have thus far confirmed her judgment: Inflation is expected to remain slightly above the target with upside risks, and the overall labor market remains robust but is cooling and may experience a more rapid-than-expected slowdown. (Jin10)