FOMC May Minutes, “Concerns Over Persistent Inflation…Must Approach Rate Cuts Cautiously”

U.S. Federal Reserve not providing any hint of interest rate cuts (Source: Federal Reserve)

The United States Federal Reserve (Fed) released the minutes of the Federal Open Market Committee (FOMC) meeting in May 2025. The attending committee members formed a consensus that the overall economic outlook is becoming more uncertain and that monetary policy should be approached more cautiously.

According to the minutes, members acknowledged that inflation could persist longer than expected and, therefore, agreed not to hastily change the interest rate policy until definitive economic signals appear. Despite deteriorating employment indicators, considering the top priority of price stability, the Fed seems to need to be cautious about easing measures like future interest rate cuts.

In particular, some members pointed out that the Fed might enter a phase where it must choose policy priorities between economic stimulus and employment recovery. This suggests that the direction of future monetary policy may be flexibly adjusted according to market conditions.