Cautious Fed: Interest Rate Cuts on Standby Amid Uncertain Economy

The Federal Reserve is pausing on further interest rate cuts amid uncertainty from the incoming US administration. December's meeting minutes may reveal policymakers' views and concerns about inflation, rate reduction, and economic strategies under President-elect Trump's policies.

In a climate of economic uncertainty, Federal Reserve officials have hit the pause button on further interest rate cuts. The central bank, after reducing rates by a quarter percentage point at its December meeting, has signaled its cautious approach amid a still robust U.S. economy.

Minutes from the meeting may shed light on the depth of sentiment among officials wary of how incoming President-elect Donald Trump's policies could impact the economy. Although projections anticipate only a half percentage point of cuts this year, compared to an earlier full point expectation, the Fed is proceeding carefully.

As new administration policies loom, the most recent data indicate economic stability, with growth above 2% and inflation at 2.4%. Fed officials, meanwhile, are monitoring the situation closely, awaiting clarity before deciding on further rate reductions or alterations to the central bank's balance sheet strategy.

(With inputs from agencies.)