Institution: The Federal Reserve's September meeting is bound to face dissent
Former chief economist at Bank of America Securities Ethan Harris stated that the days of the Federal Reserve's consensus are long gone.
The dissent in favor of rate cuts from Waller and Bowman, appointed by President Trump in July, has already "broken the harmony". This means that whatever decision the Federal Reserve makes, there will be opposing views.
Harris also stated: "I expect a fierce debate between hawks and doves before the September meeting, casting some uncertainty over the rate cut decision. The hawks will not easily back down. However, I believe this month's data will support a 25 basis point rate cut.
Mizuho Securities Chief Economist Stephen Ricchiuto stated that currently neither the hawks advocating for maintaining interest rates nor the doves supporting easing policies hold a majority. Most Federal Reserve officials maintain a middle ground. The focus of the debate within the Federal Reserve is whether it makes sense to cut rates to support a weak labor market.
