Yeliz Akmaca 
The Federal Open Market Committee (FOMC) released the minutes from its October 28–29, 2025 meeting. Participants indicated that keeping interest rates steady for the rest of the year could be appropriate. While the October rate cut received support, views on whether an additional cut in December is needed varied significantly. The minutes highlight sharp divisions within the Fed and ongoing market uncertainty.
FOMC Interest Rate Decisions and Participant Views
During the meeting, the FOMC approved a quarter-point reduction in the federal funds rate to a range of 3.75–4.00%. However, the minutes revealed no clear consensus among participants regarding December.
Many participants considered it appropriate to maintain interest rates for the rest of the year. On the other hand, some officials noted that a December rate cut could be reasonable. Additionally, a few participants warned that sudden revisions to artificial intelligence expectations could trigger irregular declines in stock prices.
The minutes also addressed the balance sheet reduction program. Nearly all participants supported ending the reduction of Treasury and mortgage-backed securities by December 1. This move affects a significant portion of the Fed’s roughly $6.6 trillion balance sheet.
December Rate Cut Expectations
Views on a potential December rate cut were divided:
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Many officials saw no need for an additional cut.
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Some noted that if economic outcomes aligned with expectations, a December cut could be appropriate.
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The general tendency leaned toward keeping rates unchanged.
In line with this, Fed Chair Jerome Powell stated in a post-meeting press conference that a December cut is “not a foregone conclusion.” He emphasized that participants expressed “very different” views on the most appropriate policy for the December meeting.
Economic Data and Decision-Making
The minutes showed that the 44-day federal government shutdown complicated data collection and decision-making. Key labor market and inflation reports were partially delayed or unavailable during this period. As a result, FOMC decisions were based on limited available data.
Participants expressed caution due to a slowing labor market and inflation not showing signs of a sustainable return to the Fed’s 2% target. The committee generally preferred that the Fed portfolio remain balanced with Treasury securities and mortgage-backed assets.
Overall, the FOMC minutes signal market skepticism toward an additional rate cut in December and highlight clear internal differences among officials. These developments provide important guidance for investors regarding interest rate policy and the Fed’s balance sheet.
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