Minutes of the US Federal Reserve Board’s October meeting show that a very different, more divided, Fed is emerging as the eight-year term of Jerome Powell’s consensus-driven chairmanship nears its end.

The minutes are studded with references to “several”, “many” or “most” of the participants in the meeting agreeing or disagreeing with assessments of economic conditions, on the 25 basis point rate cut that emerged from the Fed’s most recent meeting, and on the likelihood of another cut at its next meeting in December.

Trump is desperate to control the Fed.Credit: Getty Images

That’s unusual for the Fed, where, until earlier this year, decisions have almost always been unanimous.

Until the July meeting, when two governors (Christopher Waller and Michelle Bowman) disagreed with the majority decision to hold rates steady, it had been more than 30 years since the last time there were two governors breaking with their peers.

In September, there was a near-consensus, with only Stephen Miran – hastily parachuted onto the board by Donald Trump in September so that he could vote at the October meeting – the lone dissenter. Where the majority agreed on a 25 basis point cut, he argued for a 50 basis point reduction, as he did again last month.

According to the minutes of the October meeting, however, views – particularly of the merits of another cut in December – have become more polarised.

“Some” participants thought the Fed’s policy stance would be too restrictive even after the rate cut. Others pointed to the resilience of the economy and supportive financial conditions as indicators that monetary policy wasn’t clearly restrictive.

“In discussing the near-term course of monetary policy, participants expressed strongly differing views about what policy decisions would most likely be appropriate at the committee’s December........

© Brisbane Times