Dallas Fed's Logan Says Stubborn Inflation Didn't Warrant Rate Cut This Week

03:36 PM EDT, 10/31/2025 (MT Newswires) -- Dallas Fed President Lorie Logan said Friday that she would have preferred to hold interest rates steady this week amid price pressures, taking the same policy view as that of her Kansas City counterpart.

Logan is an alternate member of the Federal Open Market Committee this year, which means she gets to vote at a meeting if a scheduled voter is not available.

Kansas City Fed President Jeff Schmid voted for the Federal Reserve to leave rates unchanged on Wednesday, when the committee delivered a 25-basis-point cut amid concerns regarding the labor market.

In remarks prepared for delivery at a conference, Logan said inflation will likely remain above the FOMC's 2% target "for too much longer."

"This economic outlook didn't call for cutting rates," she said. "And I'd find it difficult to cut rates again in December unless there is clear evidence that inflation will fall faster than expected or that the labor market will cool more rapidly."

The labor market is cooling slowly, and remains "roughly balanced," she said. While risks to the labor market are tilted to the downside, the FOMC mitigated those risks by cutting rates in September, Logan said.

"The remaining risks to employment are ones we can monitor closely and respond to if they are becoming more likely to materialize, not ones that currently warrant further preemptive action," she said.

Schmid on Friday cited a largely balanced labor market and too-high inflation among reasons behind his voting decision.

"I do not think a 25-basis point reduction in the policy rate will do much to address stresses in the labor market that more likely than not arise from structural changes in technology and demographics," Schmid said in a statement. "However, a cut could have longer-lasting effects on inflation if the Fed's commitment to its 2% inflation objective comes into question."

Recently appointed Fed Governor Stephen Miran wanted a 50-basis-point cut on Wednesday.

During post-meeting remarks, Fed Chair Jerome Powell indicated uncertainty around a potential rate cut in December.

"There were strongly differing views about how to proceed in December," he said. "A further reduction in the policy rate at the December meeting is not a forgone conclusion -- far from it."

The probability of the FOMC reducing its policy rate by another 25 basis points in December was at 63% on Friday, with the remaining odds in favor of a no-change scenario, according to the CME FedWatch tool.

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