Rate-Cut Decision Was Narrow, Fed Minutes Show

Federal Reserve officials cut interest rates as expected last month.But minutes from their December meeting suggest that the decision was a close call — and that there is no guarantee policymakers will lower rates again anytime soon.The minutes of the central bank’s Dec.

17-18 meeting, released on Wednesday, showed that most Fed officials still expected to cut rates eventually.But they also showed that policymakers were concerned about signs that their fight against inflation was losing momentum, and they were no longer certain that interest rates were doing much to slow the economy down.

That makes a rate cut at the central bank’s next meeting, at the end of the month, unlikely, Fed-watchers say.“Almost all participants judged that upside risks to the inflation outlook had increased,” the minutes said.Policymakers believe they are “at or near the point at which it would be appropriate to slow the pace” of rate cuts.Fed officials are also dealing with a new wrinkle: President-elect Donald J.

Trump has promised to make sweeping changes to nearly every aspect of U.S.economic policy when he takes office later this month.

Some forecasters have argued that his proposals — particularly those around trade and immigration — could lead to faster inflation and slower growth.Jerome H.Powell, the Fed chair, has said that policymakers will wait to see what Mr.

Trump actually does before deciding how to respond.But the minutes from the December meeting show that some policymakers are already factoring Mr.

Trump’s proposals into their outlook.Officials cited “potential changes in trade and immigration policy” as one factor suggesting that inflation could take longer to cool than previously expected.Still, not all officials are expecting a big impact from Mr.

Trump’s policies.“If, as I expect, tariffs do not have a significant or persistent effect on inflation, they are unlikely to affect my view of appropriate monetary policy,” Christopher J.W...