Monetary policy

Federal Reserve Chair Jerome Powell said in a speech Tuesday that the central bank's policy stance is "modestly restrictive," a stance that will give the central bank flexibility to react to an uncertain economic future.

Federal Reserve Vice Chair for Supervision Michelle Bowman said in a speech Tuesday that steeper interest rate cuts should be on the table if the labor market continues to show signs of decline.

Federal Reserve Governor Stephan Miran floated the idea of conducting monetary policy with an eye toward the neutral rate and suggested that the president's immigration and fiscal policies will exert downward pressure on inflation.

Federal Reserve Bank of St. Louis President Alberto G. Musalem would not directly say whether central bank independence is under threat, instead highlighting that the topic has received more attention.

Prior to this week's Federal Open Market Committee meeting, many onlookers thought a Trump-aligned and oppositional voting bloc could emerge, complicating the central bank's message. But the quarterly economic projections show that not to be the case.

Federal Reserve Governor Stephen Miran said he hasn't spoken to President Donald Trump since the central bank's policy meeting this week, and didn't promise the president he would vote a particular way on interest rates.

Federal Reserve Chair Jerome Powell said there was a "high degree of unity" among committee members during this week's Federal Open Market Committee vote. Out of 12 FOMC members, 11 voted for a 25 basis point cut.

The Federal Open Market Committee's decision to reduce interest rates for the first time in nine months lifted bank stocks Wednesday. The 25-basis-point reduction could lead to net interest income headwinds now, but loan growth later, analysts said.

The Federal Reserve is widely expected to lower interest rates, but questions about how big of a cut and the trajectory for future cuts remain uncertain — and the White House's power struggle with the central bank is a complicating factor.

Market watchers expect the Federal Open Market Committee to announce a 25 basis point rate cut today, but are also watching for signals of more cuts to come and how many members push for a larger 50 basis point cut.