Construction continues at the Mariner S. Eccles Federal Reserve Building on December 30, 2025 in Washington, DC.
Brendan Smialowski AFP | Getty Images
Fed officials who voted against the statement after this week’s meeting said they did not think it was appropriate to suggest that interest rates would be lower next time.
Regional President Neel Kashkari of Minneapolis and Beth Hammack of Cleveland issued statements explaining their votes and provided similar rationale for the wording of their statements. However, this was not the case with the decision to leave interest rates unchanged from the current position.
Kashkari said the statement “contains a form of forward guidance regarding the expected direction of monetary policy. Given recent economic and geopolitical developments and the high degree of uncertainty in the outlook, I do not think such forward guidance is appropriate at this time.”
Instead, he said Wednesday’s Federal Open Market Committee statement should have signaled that its next action could be a rate cut or a rate hike. This is the third consecutive suspension since the committee cut interest rates three times in the second half of 2025.
Similarly, Hammack said he disagreed with decisions that showed an “accommodative bias regarding the future course of monetary policy.”
“Given the outlook, we view this apparent easing bias as no longer appropriate,” he said. Hammack said inflationary pressures “remain widespread” as the Iran war and resulting oil price hikes threaten the Fed’s 2% target.
The statement passed by an 8-4 vote, the largest majority of opposition since 1992. Dallas Fed President Laurie Logan joined Kashkari and Hammack in opposing the language of the statement. Governor Stephen Milan again opposed the rate cut in favor of cutting rates.
The specific language in question was that “In considering the scope and timing of further adjustments to the target range for the federal funds rate, the Committee will carefully evaluate available data, evolving prospects, and the balance of risks.”
The important issue is the wording “additional adjustments.” Fed observers generally view this language as suggesting that its next steps will be in line with recent rate cuts.
Data released Thursday shows inflation accelerated in March. Core inflation, which excludes food and energy, rose to 3.2%, the highest level since November 2023, according to the Commerce Department.
