Fed’s Goolsbee Explains Why He Voted Against December Rate Cut: 'Getting More Evidence First Feels Like The Wiser Choice'

• Goolsbee added that he believes the Fed should have waited for more data, especially about inflation, before cutting rates for the third consecutive time.
• As for the labor market, Goolsbee said that most of the data suggested only moderate cooling.
• However, he added that he remains optimistic that interest rates can come down by a “significant amount” through 2026.

Federal Reserve Bank of Chicago President Austan Goolsbee said on Friday that he decided to vote against the December rate cut because he thought it would be better to wait for more economic data before taking a call.

“Given the last several years, getting more evidence first feels like the wiser choice,” Goolsbee said, adding that he is not comfortable with front-loading rate cuts too heavily and assuming that the inflation will be transitory.

Goolsbee was one of the three Fed officials who dissented against the central bank’s decision of a 25-basis-point rate cut on Wednesday. The other two officials were Fed Governor Stephen Miran and Kansas City Fed President Jeffrey Schmid. While Miran wanted a 50 bps cut, Schmid joined Goolsbee to vote in favor of keeping rates unchanged.

Tariff-Induced Inflation

Goolsbee added that he believes the Fed should have waited for more data, especially about inflation, before cutting rates for the third consecutive time.

“Fundamentally, the elevated inflation may have come mainly from tariffs and may quickly prove transitory,” he said, while warning that there is a danger of the tariff-induced inflation lasting longer than what the current forecasts suggest.

As for the labor market, Goolsbee said that most of the data suggested only moderate cooling. “At the least, there is little to suggest a deterioration of the labor market so rapid that we could not have waited for the data to come in the early months of next year before deciding to act,” he said.

Fed Chair Jerome Powell stated on Wednesday that the labor market appears to be “gradually cooling.”

Rate Cut Optimism For 2026

Goolsbee said he remains optimistic that interest rates can come down by a “significant amount” through 2026.

Meanwhile, weekly jobless claims rose higher than expected in the week ended December 6. According to data released by the U.S. Department of Labor on Thursday, jobless claims rose by 44,000 to 236,000, compared to Dow Jones estimates of 223,000.

U.S. equities were mixed in Friday’s opening trade. At the time of writing, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was down 0.68%, the Invesco QQQ Trust ETF (QQQ) fell 1.38%, while the SPDR Dow Jones Industrial Average ETF Trust (DIA) gained 0.1%. Retail sentiment around the S&P 500 ETF on Stocktwits was in the ‘bullish’ territory.

The iShares 7-10 Year Treasury Bond ETF (IEF) was down by 0.24% at the time of writing.

Also See: Is LULU Stock 'Dead Money’? Jefferies Believes So But Calls CEO Change A 'Big Positive', Recommends Return To Roots

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