Fed has More Cuts Ahead, but 'There's No Urgency' Right Now, Says Priya Misra

Priya Misra, Core Plus Bond ETF Portfolio Manager at JPMorgan Asset Management, discusses her outlook for the Federal Reserve and rate-cuts to come in 2026.

Federal Reserve Bank of Chicago President Austan Goolsbee said he is projecting more interest-rate cuts for 2026 than many of his colleagues, but dissented against a rate cut this week because he wanted to wait for more data on inflation.

“I am not hawkish on rates for next year,” Goolsbee said Friday in a TV interview on CNBC. “I’m one of the most optimistic folks about how rates can go down in the coming year.”

The Chicago Fed chief’s comments followed a vote against Wednesday’s rate cut, which marked his first dissent since joining the central bank in 2023. That dissent aligned him with Kansas City Fed President Jeff Schmid, who voted against the previous rate reduction in October and lodged another dissent against this week’s decision as well.

Earlier Friday, Goolsbee published a statement explaining his vote.

“Given that inflation has been above our target for four and a half years, further progress on it has been stalled for several months, and almost all the businesspeople and consumers we have spoken to in the district lately identify prices as a main concern, I felt the more prudent course would have been to wait for more information,” he said in the statement.

While Fed Chair Jerome Powell managed to secure votes on Wednesday for a third quarter-point cut this year, opposition against the move was more widespread than the pair of dissents from Goolsbee and Schmid in favor of holding steady suggested, according to details of the decision.

Philadelphia Fed President Anna Paulson took a more dovish tack Friday, saying she was “still a little more concerned about labor market weakness than about upside risks to inflation.” She will rotate onto the US central bank’s voting roster next year, while Goolsbee and Schmid will rotate out.

“That’s partly because I see a decent chance that inflation will come down as we go through next year,” Paulson said at an event in Delaware. “The labor market is okay, but downside risks are elevated.”

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