02:31 PM EST, 12/20/2024 (MT Newswires) -- San Francisco Fed President Mary Daly (next votes in 2027) said that she is comfortable with the projection of two rate cuts in 2025, especially given the uncertainty in the outlook over the coming year and the balancing act between lowering inflation and preventing unemployment from rising.

Cleveland Fed President Beth Hammack (next votes in 2026) said that she dissented at the December FOMC meeting because of the strength of the economy and the belief that inflation will remain above the 2% target over the next year with risks skewed to the upside.

Recent comments of note:

The FOMC cut the target range for the federal funds rate by 25 basis points to 4.25% to 4.5%, but the Summary of Economic Projections indicated an expectation of fewer rate cuts next year than previously estimated due to higher inflation and growth and a lower unemployment rate than in the September estimate. Hammack dissented, preferring no change in rates, and a total of four participants penciled in no change when they completed their SEP entries prior to the meeting.

Fed Chair Jerome Powell (voter) said that the current level of the federal funds rate range is "significantly less restrictive" than it was before cumulative 100 basis point rate reduction this year, allowing the FOMC to be more cautious when considering future reductions. Still, policy is restrictive compared with the assumed neutral rate and will necessitate more rate reductions.