What changes are there in the full comparison with the Fed's January meeting statement?

What changes are there in the full comparison with the Fed's January meeting statement?

On Wednesday, January 28 local time, the Federal Reserve kept rates unchanged as expected, signaling no rush to take action. However, Fed Chair nominee Waller supported a further rate cut of 25 basis points. In this statement, the Fed’s wording about the outlook for the US economy was adjusted compared to the December 2025 meeting:

  • The Fed’s description of economic activity changed from last month’s “moderate pace of expansion” to “solid pace of expansion.”
  • On the labor market, the Fed added that “employment growth remains sluggish,” revising the previous statement that “employment growth has slowed.” The Fed’s latest statement said, “The unemployment rate has shown signs of stabilizing,” and deleted last month’s statement that “the unemployment rate increased as of September, and more recent indicators are consistent with these changes.” The Fed also removed the line, “The committee judges that downside employment risks have increased in recent months.”
  • The Fed now states “inflation remains somewhat elevated,” whereas last month, it said “inflation has increased from the level at the beginning of the year.”

The Fed’s latest statement removed the phrase “in light of the change in the balance of risks.”

It is worth noting that there were two dissenting votes at this meeting:

  • Fed Governor Stephen Miran, appointed by President Trump in September last year, voted against again. He advocated for a 25 basis point rate cut at this meeting. In the meetings in September, October, and December, the Fed each cut rates by 25 basis points, and Miran voted against in all three meetings, arguing for a 50 basis point cut.
  • Fed Governor Waller opposed the rate decision at the January meeting, believing that rates should be cut by 25 basis points. Analysts say this suggests that he remains a candidate for Fed Chair, as Trump wants someone who supports rate cuts for the next chair.

Full Statement Translation

The full translation of the statement is as follows. Black font indicates parts identical to the December 2025 FOMC statement, red font marks newly added portions for January 2026, and bracketed blue font are the December statement wordings that were deleted (please credit source when sharing):

Available indicators suggest that economic activity is expanding at a solid(moderate) pace. (since the beginning of the year) Employment growth remains sluggish(has slowed), and the unemployment rate has shown signs of stabilizing(rose as of September; more recent indicators are consistent with these changes). Inflation(has increased compared to the beginning of the year,) remains somewhat elevated.

The Committee seeks to achieve maximum employment and 2% inflation over the longer run. Uncertainty around the economic outlook remains high. The Committee closely monitors factors that may affect its dual mandate(, and judges that downside employment risks have increased in recent months).

To support its goals, (and in light of changes in the risk balance,) the Committee decided to maintain the target range for the federal funds rate at 3.50% to 3.75%(lowered by 0.25 percentage points to). In considering any further adjustments to the target range for the federal funds rate, the Committee will carefully assess future data, changing outlooks, and the balance of risks. The Committee remains strongly committed to supporting maximum employment and bringing inflation back to its 2% target.

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of new information for the economic outlook. Should risks emerge that may hinder achievement of its goals, the Committee stands ready to adjust the stance of monetary policy as appropriate. The Committee’s assessment will take into account a wide range of information, including labor market conditions, inflation pressures and expectations, and financial and international developments.

(The Committee judges that the level of reserve balances has declined to adequate levels and will purchase short-term U.S. Treasury securities as needed to maintain ample reserve supplies.)

Voters in favor of this monetary policy action included: FOMC Chair Jerome H. Powell, Vice Chair John C. Williams, Michael S. Barr, Michelle W. Bowman,(Susan M. Collins,) Lisa D. Cook, Beth M. Hammack, Philip N. Jefferson, Neel Kashkari, Lorie K. Logan, and Anna Paulson(Alberto G. Musalem and Christopher J. Waller). Committee members voting against this action included Stephen I. Miran and Christopher J. Waller, who favored lowering the target range for the federal funds rate by 0.5 percentage points at this meeting(, as well as Austan D. Goolsbee and Jeffrey R. Schmid, who favored maintaining the target range at this meeting).

 

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