Fed's resolution full text: interest rate cut and announcement to end balance sheet reduction, two opposing votes show increasing divergence

On October 30, the Fed lowered the benchmark interest rate by 25 basis points to 3.75%-4.00%, marking the second consecutive meeting of rate cuts, in line with market expectations. Two committee members voted against, indicating a growing divide. Among them, Kansas Fed President Schmidt opposed the rate cut and supported keeping rates unchanged; Director Milan opposed this rate decision, arguing for a 50 basis point cut. Additionally, the Fed FOMC statement announced the termination of the balance sheet reduction on December 1, currently reducing $5 billion in U.S. Treasuries and $35 billion in MBS monthly. After that, the principal of mortgage-backed securities will be reinvested in short-term government bonds. Full text of the rate decision: Available indicators show that economic activity is expanding at a moderate pace. Job growth has slowed this year, and the unemployment rate has risen slightly, but remains at a low level as of August; more recent indicators are consistent with the aforementioned trend. Inflation has risen since the beginning of the year and remains relatively high. The committee's goals are to achieve maximum employment and a long-term inflation rate of 2%. The uncertainty regarding the economic outlook remains high. The committee closely monitors the risks of its dual mandate and believes that the downside risks to employment have increased in recent months. To support the above goals and in light of changes in the risk balance, the committee decided to lower the federal funds rate target range by 25 basis points to 3.75% to 4%. In considering further adjustments to the federal funds rate target range, the committee will carefully assess the latest data, changes in the economic outlook, and the risk balance. The committee also decided to end its reduction of the total amount of securities held starting December 1. The committee is firmly committed to supporting maximum employment and driving inflation back to the 2% target level. When assessing the appropriate stance of monetary policy, the committee will continue to monitor how new information affects the economic outlook. If risks emerge that could hinder the achievement of the committee's goals, the committee will adjust its monetary policy stance as deemed appropriate. The committee's assessment will consider a wide range of information, including labor market conditions, inflation pressures and inflation expectations, as well as the latest developments in financial and international contexts. Members voting in support of this monetary policy action include Chairman Jerome H. Powell, Vice Chairman John C. Williams, Michael S. Barr, Michelle W. Bowman, Susan M. Collins, Lisa D. Cook, Austan D. Goolsbee, Philip N. Jefferson, Alberto G. Musalem, and Christopher J. Waller. Members voting against were Stephen I. Miran, who favored a half-point reduction in the federal funds rate target range at this meeting, and Jeffrey R. Schmid, who favored keeping the rate range unchanged at this meeting.