At long last, the Federal Reserve is on the verge of resuming rate cuts. The Federal Reserve last cut the Federal Funds Rate to its current target level of 4.25-4.50% in December 2024.

By Tuesday, when the Fed's rate-setting Federal Open Market Committee convenes, a central tenet of its independence may have been stripped away by federal judges, and Miran, a harsh critic of the Fed currently serving as chair of Trump's Council of Economic Advisers, may have been sworn in as a governor and participating in the debate.

After the "gangbuster" December jobs report, the Federal Reserve's rate-cutting cycle is over, said Aditya Bhave, senior U.S. economist at BofA Global Research. "Our base case has the Fed on an extended hold," Bhave said in a note to clients.

The Federal Reserve’s preferred measure of underlying inflation remained muted in December and real incomes were soft, which should support further reductions in interest rates this year. The so-called core personal consumption expenditures price index ...

Claudia Sahm, a former Fed economist, helps us understand the importance of this week’s meeting, the future of the central bank, and the real health of the U.S. economy.