On January 9, the Financial Association reported (Editor Niu Zhanlin) that local time on Wednesday, the Federal Reserve published the minutes of the December monetary policy meeting on its official website. The minutes indicate that considering inflation risks remain high, the Federal Reserve officials have taken a new stance on interest rate cuts and decided to slow down the pace of cuts in the coming months.

The minutes state that participants indicated the committee believes that the level of interest rates is close to or at an appropriate moment to slow down the pace of rate cuts. They believe the pace of cuts may slow down in the future, entering a more cautious operational phase.

Moreover, a series of factors indicate that, in the current complex economic environment, Federal Reserve decision-makers believe that careful adjustments to monetary policy are needed to avoid the negative impacts of overly aggressive policy adjustments. For example, rapid interest rate cuts may lead to a resurgence of inflationary pressures.

Participants expect inflation to continue to approach 2%, although they pointed out that the recent inflation data exceeding expectations, as well as the potential impacts of trade and immigration policy changes, indicate that this process may take longer than previously anticipated. Some participants noted that the anti-inflation process may have temporarily stalled or highlighted possible risks.

Regarding the impact of the incoming Trump administration's policies, Federal Reserve staff have already taken them into account, although the specific details of these policies remain unclear.

Since Trump won the election in November last year, he has explicitly stated plans to impose punitive tariffs on Mexico, Canada, and other countries. Additionally, he intends to seek deregulation and large-scale deportations of immigrants.

Some decision-makers indicated that they have incorporated 'placeholder assumptions' into their latest economic forecasts, with almost all participants believing that the upside risks to the inflation outlook have increased.

Regarding employment, Federal Reserve officials expect the USA job market to remain strong, with the unemployment rate at a low level, although various Indicators in the labor market still need close monitoring.

The day before, the USA Bureau of Labor Statistics released the Job Openings and Labor Turnover Survey (JOLTS) report, showing that driven by significant growth in Business Services, job vacancies in the USA rose to a six-month high in November, indicating a very stable job market.

Although the Federal Reserve cut interest rates by 25 basis points last month, some officials voted against the rate cut, which has been extremely rare in recent years.

Some participants indicated that given the stagnation in progress towards reducing inflation, it is preferable to maintain rates. Most attendees believe that their judgment is in a delicate balance when deciding what policy action to take at this meeting. This indicates significant divisions among decision-makers regarding whether to adjust interest rates.

Regarding interest rate cuts, officials emphasized that future policy actions will depend on the development of data rather than a fixed timetable.

Federal Reserve Governor Cook stated on Monday that given the strong job market and persistent inflationary pressures, policymakers can act more cautiously regarding interest rate cuts. "Since the Federal Reserve began lowering its benchmark interest rate last September, the labor market has been proving to be more resilient, while inflation has been more stubborn than initially expected."

"The Federal Reserve's spokesperson" Nick Timiraos pointed out that the meeting minutes further indicate that officials are generally willing to keep interest rates unchanged at the meeting scheduled for the end of this month. The minutes state: "Participants indicated that the committee is at or near appropriate levels to slow the pace of policy easing." Officials believe that based on their current outlook for economic activity, the Federal Reserve may continue to lower interest rates at a slower pace than in recent months.