"New Fed Whisperer" Analyzes December Rate Cut

① Renowned journalist Nick Timiraos, often referred to as the "new Fed whisperer," wrote in a latest article on Tuesday local time that due to significant internal divisions at the Federal Reserve, the path to interest rate cuts is becoming increasingly uncertain; ② This situation is almost unprecedented during Fed Chair Powell's nearly eight-year tenure.

Timiraos pointed out that Fed officials are currently divided on which threat is greater—persistent inflation or a weak labor market. Even the resumed release of official economic data may not bridge these divisions.

This split is complicating plans for consecutive rate cuts that seemed feasible just two months ago. Although investors in the interest rate market still believe the likelihood of a rate cut at the Fed's next meeting is slightly greater than no cut.

Timiraos noted that hawkish and dovish voices within the Fed are growing increasingly loud, while the stance of centrists is becoming more unstable. Doves are concerned about a weak labor market but lack new evidence to support rate cuts; hawks are seizing the opportunity to argue for pausing rate cuts—they believe consumer spending is stable and worry that businesses are preparing to pass tariff-related costs on to consumers.