• Richmond Fed President Thomas Barkin agrees with Chair Jerome Powell that a December interest rate cut is not a foregone conclusion.
  • The Federal Reserve lowered rates by 25 basis points to 3.75%-4.00% at its October meeting, citing rising employment risks and persistently elevated inflation.
  • Market expectations for a December cut have fallen to approximately 50%, reflecting heightened uncertainty about the Fed's next policy move.

Richmond Federal Reserve President Thomas Barkin has publicly aligned himself with Chair Jerome Powell's cautious stance, emphasizing that the central bank has not committed to another interest rate cut at its December meeting. This public support from a key FOMC voter underscores the deep uncertainty surrounding monetary policy as the Fed navigates conflicting economic signals.

The Fed's October decision to lower its benchmark rate by 25 basis points to a target range of 3.75%-4.00% was accompanied by a notably cautious tone from Powell. During his post-meeting press conference, Powell explicitly stated that a follow-up cut in December was not guaranteed, a message Barkin has now reinforced. The Federal Open Market Committee's next scheduled meeting is set for December 9-10, 2025.

"I agree with the Chair that December is not a foregone conclusion," Barkin said, according to people familiar with his remarks. "We are seeing crosscurrents in the data that require careful assessment."

Efforts to ease monetary policy have hit a snag as inflation, after moderating earlier in the year, has proven stubbornly persistent. At the same time, payroll growth has slowed and the unemployment rate has inched upward, creating a complex policy dilemma. Policymakers cited these rising downside risks to employment alongside elevated price pressures as primary reasons for their cautious approach.

Market pricing reflects this newfound uncertainty. The probability of a December rate cut implied by futures contracts has plummeted to around 50%, a sharp reversal from earlier expectations that viewed additional easing as highly likely. This volatility highlights the Fed's intensely data-dependent posture in the final months of 2025.

Attempts to reach a spokesperson for the Richmond Fed for additional comment were not immediately successful.

Without a clear signal for further easing, businesses and borrowers face continued uncertainty. The Fed's struggle to balance its dual mandate of maximum employment and price stability is becoming increasingly apparent as economic crosswinds intensify. Other major central banks, including the European Central Bank and the Bank of England, are facing similar challenges with sticky inflation, suggesting a coordinated global slowdown in monetary easing efforts.

Correction: An earlier version of this article misstated the timing of the Fed's last rate cut. It occurred in October 2025, not September.