Federal Reserve officials are increasingly divided over the future of interest rates, with a growing rift between those who believe monetary policy is too tight for a softening labor market and others who remain focused on persistent inflation. The disagreement comes on the heels of last week’s quarter-point rate cut and reflects broader uncertainty over how to balance the Fed’s dual mandate of stable prices and maximum employment.
Federal Reserve Chair Jerome Powell signaled on Friday that the central bank could cut interest rates as early as September. Speaking at the Kansas City Fed’s annual Jackson Hole conference, Powell cited a shift in risks toward slowing job growth as the rationale for changing course.
