#The Fed slows the pace of rate cuts.#

The minutes of the Federal Reserve's recent December monetary policy meeting show that officials are leaning toward slowing the pace of interest rate cuts, believing that rates are near or at a level where it is appropriate to do so. This decision is primarily based on the continued elevated risk of inflation and the complexity of the economic environment. The minutes note that participants expect inflation to continue to move toward 2%, but recent higher-than-expected inflation data and the potential impact of trade and immigration policy changes suggest that this process may take longer than previously anticipated. Some participants even noted that the disinflationary process may have stalled temporarily, or pointed to potential risks. As a result, Fed policymakers believe that a cautious approach to adjusting monetary policy is needed, avoiding the negative consequences of overly aggressive policy adjustments, such as a rapid pace of rate cuts that could lead to renewed inflationary pressures. Based on the current economic outlook, the Fed is likely to continue cutting rates at a slower pace than in recent months and hold rates steady at its upcoming meeting at the end of this month.