The central bank cut rates last month but saw risks of somewhat firmer price pressures this year due to potential tariff increases by President-elect Trump.

Federal Reserve officials debated the staying power of inflation at the central bank’s December meeting, with a range of views on where interest rates could settle in 2025. Policymakers emphasized that policy is not on a preset path and will need to evolve in response to both economic data and the new administration’s policies.

The Federal Open Market Committee is highly likely to hold interest rates at their current level at their next meeting, but cuts later in 2025 remain on the table.