Fed Split: Inflation Hardliners and Employment Advocates Disagree on Interest Rate Reduction

Bitget App

Trade smarter

Bitget

News

Markets

Fed Split: Inflation Hardliners and Employment Advocates Disagree on Interest Rate Reduction

Bitget-RWA2025/11/13 19:15

By:Bitget-RWA

- U.S. Federal Reserve faces uncertainty ahead of December meeting due to delayed government data from the shutdown. - Officials split between rate-cut advocates (e.g., Mary Daly) and hawks (e.g., Susan Collins) over inflation risks and labor market gaps. - Market expectations now favor a 55% chance of a December rate cut, down from earlier confidence amid cautious official statements. - Fed relies on private-sector indicators to assess inflation and employment, but lacks comprehensive official data for cl

The U.S. Federal Reserve is grappling with increased uncertainty ahead of its December policy meeting, as essential economic indicators—such as October’s employment and inflation data—may be postponed or unavailable due to the recent government shutdown.

A White House official stated

on Wednesday that these vital statistics might not be released in time for the Fed’s deliberations, making it more difficult to evaluate the state of the economy and fueling a contentious debate among central bank leaders.

Fed policymakers now face a delicate challenge, weighing inflationary threats against concerns about the job market.

San Francisco Fed President Mary Daly, who has previously favored lowering rates, admitted

the uncertainty, saying that making a decision on December’s policy is “premature” without updated figures. At the same time,

Boston Fed President Susan Collins has become a strong proponent

of keeping interest rates unchanged, pointing to “persistent inflation” and insufficient labor data as reasons to hold off on easing. Her position represents a growing group of “hawks” at the Fed who warn that further rate cuts could worsen inflation.

This split is reflected in market sentiment, with the likelihood of a December rate cut now at about 55%, a decline from earlier optimism

according to analysis

. This change follows Collins’ comments and similar caution from other Fed members, such as St. Louis Fed President Alberto Musalem, who cautioned against making policy “too accommodative,” and Fed Vice Chair Philip Jefferson, who stressed the importance of caution given the lack of data

according to reports

Fed Chair Jerome Powell has voiced similar worries

, saying that another rate cut is “far from” guaranteed and noting the difficulty of managing internal disagreements.

With official data unavailable, the Fed has turned to alternative sources, such as private surveys and anecdotal reports, to assess economic trends. However, these alternatives do not offer the same depth as the delayed government releases. For example,

Apollo Global Management’s chief economist Torsten Slok observed

that prices for 55% of Consumer Price Index items are increasing at over 3%, exceeding the Fed’s 2% goal. While these findings are useful, they contribute to the uncertainty about where inflation is headed.

Fed Split: Inflation Hardliners and Employment Advocates Disagree on Interest Rate Reduction image 0

This situation highlights the broader difficulties the Fed faces as it tries to steer a fragile economy. Some members, like Daly, are open to rate cuts if justified by new information, while others, such as Collins, insist that holding rates steady is crucial for keeping inflation in check. The debate is further complicated by political factors:

President Donald Trump has underscored his influence

over the Fed, including the authority to select its next chair, sparking concerns about the central bank’s autonomy.

As the December 9-10 meeting nears, the Fed’s ultimate decision will depend on whether any new data—if released—clarifies the outlook for inflation and employment. For now, the lack of October’s reports leaves officials in a difficult spot, and markets are preparing for a policy decision as uncertain as the data itself.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

PoolX: Earn new token airdrops

Lock your assets and earn 10%+ APR

Lock now!

- Grayscale Investments files for NYSE IPO as "GRAY", managing $35B in crypto assets including its flagship Bitcoin product. - The SEC filing follows a July S-1 submission, reflecting broader crypto sector trends with firms like Circle and Gemini also going public. - 2025 revenue dropped 20% to $318.7M due to competitive pressures and crypto market volatility, despite 2023 ETF conversion boosting credibility. - The IPO roadshow with Morgan Stanley and others targets $30-33B valuation, with listing expected

Bitget-RWA•2025/11/13 20:42

Bitcoin News Update: Grayscale Submits IPO Application Amid 20% Revenue Decline and Intense Cryptocurrency Market Rivalry

Shutdown Chaos: Airlines Face Disruptions Amid Political Stalemate Halting Flights

- Delta CEO Bastian condemned the government shutdown, blaming unpaid air traffic controllers for 500 flight cancellations and traveler chaos. - Trump threatened pay cuts for absent controllers while offering $10k bonuses, exacerbating staffing shortages at 30 major U.S. airports. - FAA reported 20-40% controller absences daily, triggering 10,000+ delays and 2,800 cancellations as airlines waive fares and offer refunds. - Political leaders urged a shutdown end, but FAA's 10% flight reduction directive pers

Bitget-RWA•2025/11/13 20:42

COAI Token Fraud Unveiled and Its Impact on DeFi Safety: Evaluating Regulatory Preparedness and Shortcomings in Investor Safeguards within Developing Cryptocurrency Markets

- COAI token's 2025 collapse exposed DeFi vulnerabilities in emerging markets due to governance failures and regulatory ambiguity. - CLARITY Act's vague AI token definitions and U.S. regulators' conflicting classifications (securities vs. commodities) worsened market uncertainty. - Southeast Asia's crypto scams, including She Zhijiang's Myanmar operation, exploit weak governance and jurisdictional loopholes to defraud $10B annually. - IRS DeFi rules face legal challenges over privacy concerns, while platfo

Bitget-RWA•2025/11/13 20:36

COAI Token Fraud Unveiled and Its Impact on DeFi Safety: Evaluating Regulatory Preparedness and Shortcomings in Investor Safeguards within Developing Cryptocurrency Markets

UK Faces Stablecoin Challenge: Balancing Innovation and Financial Security

- UK faces pressure to launch GBP stablecoin to compete globally, urged by ClearBank CEO Mark Fairless at Web Summit 2025. - BOE proposes 40% central bank deposit reserves for GBP stablecoins, with £20k/£10m user/business limits to mitigate systemic risks. - Critics argue 40% unremunerated reserves could stifle innovation, putting UK issuers at disadvantage compared to US/EU frameworks. - Regulatory balancing act emerges as UK aims to position itself as crypto innovation hub while maintaining financial sta

Bitget-RWA•2025/11/13 20:26