Federal Reserve's Collins Maintains Stance Against December Rate Cuts
Boston, Sunday, 23 November 2025.
Boston Fed President Susan Collins remains reluctant to support a rate cut in December, citing persistent inflation concerns and labor market risks, emphasizing cautious policy decisions amid economic uncertainties.
Inflation and Labor Market Concerns
Susan Collins, President of the Federal Reserve Bank of Boston, has expressed concerns over inflationary pressures and labor market risks, suggesting a cautious approach to potential rate cuts in December. Her remarks come as the Federal Reserve grapples with balancing economic growth and price stability. Despite a 50-basis-point reduction in rates during September and October, Collins believes the policy is currently ‘mildly restrictive,’ which she finds appropriate given the current economic conditions [1][2].
Divergent Views Within the Federal Reserve
There appears to be a growing divergence in viewpoints among Federal Reserve officials regarding future monetary policy. New York Fed President John Williams hinted at the possibility of further adjustments to the federal funds rate, suggesting room for lowering rates, while Boston Fed’s Collins remains cautious. This divergence points to potential disagreements at the upcoming Federal Open Market Committee (FOMC) meeting scheduled for December 9-10, 2025 [1][3].
Implications for Businesses and Borrowers
The Federal Reserve’s current stance, which includes maintaining a mildly restrictive policy, has significant implications for businesses and borrowers. High-interest rates can curb borrowing and spending, potentially slowing down economic activity. Small businesses, in particular, have expressed concerns about rising prices and policy instability, which may affect their operations and growth prospects [1][4].
Future Economic Outlook
Looking ahead, Collins has highlighted the importance of monitoring economic indicators closely, particularly the labor market and inflation trends. While the unemployment rate has shown signs of increase, inflation remains above the Fed’s target, complicating the decision-making process. As the FOMC meeting approaches, the Federal Reserve will continue to assess these factors to determine the appropriate course of action [2][4].