“Fed Whisperer”: Shift in Fed’s Internal Winds, Policy Path Moves from Rate-Cut Expectations to Rate-Hike Assessments

Odaily reported that Nick Timiraos, known as the "Fed Whisperer," wrote in The Wall Street Journal that the discussion within the Federal Reserve regarding the interest rate path has clearly shifted. The focus is no longer primarily on when to restart rate cuts but has begun to consider under what conditions it might be necessary to raise rates again. Since the Fed began issuing policy statements in 1994, disagreements over how to describe the policy direction (rather than actual rate changes) have been rare.

Three regional Fed presidents, including Dallas Fed President Lorie Logan and Minneapolis Fed President Neel Kashkari, opposed retaining the language that the "next move is more likely to be a rate cut" at this week's policy meeting, arguing that the next rate adjustment could be either a hike or a cut. Outgoing Fed Chair Jerome Powell, however, stated that the committee is gradually shifting from a "rate-cutting bias" to a "neutral stance," and added that if a rate hike were needed in the future, the Fed would first move to neutral and then signal a rate increase. (WSJ)