Federal Reserve Resolution Full Text: Pause on Interest Rate Cuts, Mester and Waller Cast Dissenting Votes

On January 29, as the first interest rate decision of 2026, the Federal Reserve kept the benchmark interest rate unchanged at 3.50%-3.75%, pausing the consecutive three rate cuts since last September, in line with market expectations. The policy statement indicated that there are still disagreements among participants, with Governor Miran and Governor Waller opposing this rate decision and supporting a 25 basis point cut.

Full Text of the Interest Rate Decision

Available indicators show that economic activity continues to expand at a steady pace. Employment growth remains low, and the unemployment rate has shown some signs of stability. Inflation levels are still slightly high.

The committee is committed to achieving full employment in the long term and maintaining the inflation rate at the target level of 2%. Uncertainty regarding the economic outlook remains at a high level. The committee is closely monitoring the risks to its dual mandate.

To support the aforementioned goals, the committee decided to maintain the federal funds rate target range at 3.5-3.75%. When considering the magnitude and timing of any further adjustments to the federal funds rate target range, the committee will carefully assess the latest published data, the evolving outlook, and the balance of risks. The committee is firmly committed to supporting full employment and bringing inflation back to the target level of 2%.

In assessing whether the monetary policy stance is appropriate, the committee will continue to pay attention to the impact of the latest information on the economic outlook. Should risks arise that could impede the committee's ability to achieve its goals, the committee will be prepared to adjust the monetary policy stance as appropriate. The committee's assessment will take into account a wide range of information, including labor market conditions, inflationary pressures and expectations, as well as developments in financial and international conditions.

Voting in favor of this monetary policy action were: Chair Jerome H. Powell, Vice Chair John C. Williams, Michael S. Barr, Michelle W. Bowman, Lisa D. Cook, Beth M. Hammack, Philip N. Jefferson, Neel Kashkari, Lorie K. Logan, and Anna Paulson.

Opposing the decision were Stephen I. Miran and Christopher J. Waller, who favored a 25 basis point reduction in the federal funds rate target range at this meeting.

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