The Fed Will Cut Next Week

The Federal Reserve is all but certain to cut interest rates by 25 basis points next week, bringing the federal funds rate down to a range of 3.5 to 3.75 percent. Markets are pricing in an almost 90 percent probability of the move , and Fed chairman Jerome Powell has signaled as much in recent weeks.

But beneath this surface consensus lies the most divided Federal Open Market Committee in recent memory, a split that could have significant implications for monetary policy in 2026 and beyond.

As Treasury Secretary Scott Bessent recently reminded us, the Fed chairman gets just one vote on the Federal Open Market Committee (FOMC) that makes monetary policy. As a refresher, the FOMC consists of seven Fed Governors (including the chair), the New York Fed Preside

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