WASHINGTON — The Federal Reserve on Tuesday made public the minutes from its contentious meeting held earlier this month, which resulted in a vote to reduce interest rates again, reflecting a decision that was seemingly more precarious than the final tally suggested.

During the Dec. 9-10 meeting, officials shared a range of viewpoints, as indicated in the summary released a day early due to the upcoming New Year’s holiday.

The Federal Open Market Committee ultimately sanctioned a quarter-percentage point reduction with a 9-3 vote, marking the most dissenting voices since 2019, as officials discussed the necessity to bolster the labor market in light of inflation concerns. This action adjusted the key funds rate to a range of 3.5%-3.75%.

“Most participants assessed that further downward modifications to the target range for the federal funds rate would likely be suitable if inflation diminished over time as anticipated,” the document stated.

However, there were reservations about how aggressive future actions should be taken by the FOMC.

“Regarding the extent and timing of future modifications to the target range for the federal funds rate, some participants proposed that, based on their economic predictions, it might be appropriate to maintain the target range unchanged for a period following the reduction at this meeting,” the minutes conveyed.

Officials expressed optimism that the economy would continue to grow at a “moderate” rate, while acknowledging potential downside risks regarding employment and upside risks related to inflation. The balance between these two issues created divisions among FOMC policymakers, suggesting that the vote could have swung either way despite the six-vote majority in favor of the cut.

“A few of those who supported the reduction in policy rates at this meeting expressed that the choice was finely balanced or that they could have endorsed maintaining the target range,” the minutes revealed.

Following the release, stocks remained slightly down. Traders increased speculation that the Fed would execute another cut in April.

The vote also corresponded with a quarterly revision of the committee’s Summary of Economic Projections, which includes the closely monitored “dot plot” indicating the individual officials’ rate expectations.

The 19 officials present at the December gathering — 12 of whom vote on rates — indicated a probable additional cut in 2026, followed by another in 2027. This would bring the funds rate down to close to 3%, a level that officials regard as neutral since it neither hinders nor stimulates economic growth.

The group favoring maintaining the rate stability “voiced worries that advancements toward the Committee’s 2 percent inflation goal had stagnated in 2025 or suggested that they required more assurance that inflation was being sustainably reduced to meet the Committee’s target.”

Officials mentioned President Donald Trump’s tariffs were elevating inflation, but they also collectively agreed that the effects would likely be transient and would diminish heading into 2026.

Since the vote, economic indicators have pointed to a labor market where hiring remains sluggish but layoffs have not intensified. On the inflation front, prices have been gradually decreasing but still remain far from the Fed’s 2% objective.

Meanwhile, the overall economy continues to show strong performance. Gross domestic product jumped in the third quarter, growing at a 4.3% annualized rate, outperforming projections and marking a half-percentage point improvement over the robust second quarter.

Nonetheless, most data comes with a significant caveat: Reports are still lagging as government entities compile information from the difficult period during the government shutdown. Even the more recent reports, at least from official sources, are viewed with caution due to data inconsistencies.

As a result, markets largely anticipate the FOMC to remain steady in the upcoming meetings as policymakers evaluate incoming information. The holiday season saw little commentary from Fed officials, and the few remarks made predominantly reflect caution as the new year approaches.

The committee’s makeup is also set to change, with four new regional presidents stepping into voting roles. They include Cleveland President Beth Hammack, who opposes not only further cuts but also prior ones; Philadelphia President Anna Paulson, who has sided with FOMC doves expressing concern about inflation; Dallas President Lorie Logan, who has raised concerns regarding rate reductions; and Minneapolis President Neel Kashkari, who indicated he wouldn’t have supported the October cut.

Additionally, at the meeting, the committee voted to reactivate its bond-buying initiative. Under the new arrangement, the Fed will be purchasing short-term Treasury bills to alleviate pressures in short-term funding markets.

The central bank launched the program by acquiring $40 billion monthly in bills, maintaining that pace for several months before tapering. A previous attempt to reduce the balance sheet saw the Fed decrease its assets by approximately $2.3 trillion to its current $6.6 trillion.

The minutes noted that if the bond-buying program, referred to in markets as quantitative easing, was not reinstated, it could lead to “significant declines in reserves” falling below the Fed’s “ample” regime for the banking system.

Correction: The vote came with a quarterly update of the committee’s Summary of Economic Projections. An earlier version incorrectly stated the name of the forecast.

Mortgage interest rates have decreased, housing prices are stabilizing, and there is an increase in available listings on the market. This culmination results in enhanced affordability for prospective homebuyers today. However, saving for a down payment remains the primary obstacle for those buying their first home.

According to Parcl Labs, which conducts daily analyses of U.S. home prices, the national prices are essentially unchanged from a year ago. They briefly entered negative territory earlier this month and are currently just 0.3% above last year’s figures.

The most recent S&P Cotality Case-Shiller home price index, reflecting data from October, revealed significant variations across metropolitan markets. Among the top 20 markets identified, Chicago, New York, and Cleveland experienced the most considerable increases. In contrast, eight cities reported declining prices, with Tampa, Florida; Phoenix; and Dallas facing the most significant downturns.

“National home prices continue to fall behind consumer inflation, as October’s CPI is projected around 3.1% (based on a provisional index announced by the U.S. Treasury due to the federal data shutdown) – approximately 1.8 percentage points above the most recent housing appreciation. In real terms, this discrepancy suggests a modest decrease in inflation-adjusted home values over the last year,” stated Nicholas Godec, head of fixed income tradables and commodities at S&P Dow Jones Indices, in a statement.

Mortgage rates are also declining.

Currently, the average rate for a 30-year fixed mortgage stands at 6.19%, according to Mortgage News Daily. At the beginning of the year, it was significantly above 7%. This reduction translates to substantial savings for homebuyers.

For instance, for a buyer making a 20% down payment on a $410,000 home (which is close to the national median), the average monthly payment is now $200 lower than it was a year ago. Decreased prices and lower rates are reshaping what first-time buyers can afford.

The average homebuyer currently requires seven years to accumulate a down payment, as reported by Realtor.com. This duration has decreased from the recent high of 12 years in 2022 but remains approximately double pre-pandemic figures, partly due to the significantly lower personal savings rate compared to 2020.

Down payments continue to present the greatest challenge to homeownership, which in the latter half of this year dropped to 65%, according to the U.S. Census, marking the lowest figure since 2019.

However, a better supply of homes available for sale is generating momentum in the market. Active listings are now around 12% higher than a year ago, according to Realtor.com, although they remain 6% lower than the levels just prior to the pandemic.

Buyers seem to be reacting positively. Pending home sales, which account for signed contracts on existing properties, increased more than anticipated in November. They were up 3.3% from October, 2.6% above November 2024, and reached the highest point in nearly three years, according to the National Association of Realtors.

“Rising housing affordability—driven by decreased mortgage rates and wage growth outpacing home price increases—is encouraging buyers to explore the market. The greater variety of available inventory compared to last year is also pulling more buyers into the market,” remarked Lawrence Yun, chief economist for the Realtors, in a statement.