Fed Governor Michelle Bowman Projects Two More Rate Cuts This Year

Fed Governor Michelle Bowman has commented on how many more rate cuts the FOMC could make this year. This comes as the crypto market prices in another Fed rate cut at the upcoming October FOMC meeting, while there is also the likelihood of another cut at the December meeting.

Michelle Bowman Sees Two More Fed Rate Cuts This Year

During a discussion at the 2025 Institute of International Finance (IIF) Annual Membership Meeting, the Fed governor said that she sees two more rate cuts this year. This would mean the FOMC could ultimately make three cuts this year, after lowering rates at the September FOMC meeting.

Bowman’s statement follows that of Philadelphia Fed President Anna Paulson, who also signaled support for two more Fed rate cuts this year. Notably, the committee’s median estimate projections showed that most officials expect two more cuts this year.

According to Polymarket data, there is a 73% chance the Fed will make three rate cuts this year, while there is a 19% chance of just two cuts, including the first cut from last month. It is worth noting that the CME FedWatch data shows a 96.7% chance of a 25-basis-point (bps) cut this month. The market is also expecting another 25 bps cut at the December meeting.

Other Officials Signal Support For More Cuts

Besides Bowman and Paulson, some other Fed officials have signaled support for more rate cuts this year. As CoinGape reported, Fed Governor Chris Waller said he supports more cuts this year, though he cautioned against increasing the pace. He indicated that two more 25-bps Fed rate cuts were fine amid calls for 50-bps cuts.

Those who have supported further cuts have pointed to the weakening labor market, which they believe should take priority right now, as inflation remains steady, though above their 2% target. The FOMC will likely have to make this month’s rate cut decision without key economic data due to the ongoing U.S. government shutdown.

However, as CoinGape reported, the Bureau of Labor Statistics (BLS) announced it will release the September CPI inflation data on October 24 despite the shutdown. This will happen just five days before the FOMC meeting on October 29.

The inflation report could influence the Fed rate cut decision at the meeting, especially with some officials still worried about the inflation risks. A lower-than-expected inflation rate would cement the likelihood of a cut.