Federal Reserve officials Michelle Bowman and Jeff Schmid have signaled a cautious stance on future rate cuts, suggesting that the benchmark rate may already be close to its “neutral” target following 100 basis points of reductions since September. Their position contrasts with other Fed officials, including Chairman Powell and Governor Waller, who maintain that rates remain restrictive. Bowman expressed particular concern about strong economic growth and a 20% rise in the stock market, warning of potential inflation risks. The differing views among Fed officials point to a potentially widening divide within the committee in 2025, with clarity on President-elect Trump’s economic policies potentially helping to bridge these differences. Notably, Bowman, who is considered a frontrunner for the Fed vice chair for supervision role, also called for increased transparency in bank regulation.