Federal Reserve's Williams: Widening wealth inequality among American households puts a December rate cut in a dilemma.

New York Fed President Williams pointed out that data and conversations with community leaders indicate that many poor families are experiencing a payment crisis. The so-called "divergence" among American households could be a key factor influencing their support for a Fed rate cut in December. Speaking about the December meeting decision, Williams said, "The current situation is essentially this—inflation is high and shows no signs of slowing down, while the economy is showing some resilience." Although the US labor market is still "gradually cooling," there has been "no more dramatic shift." Unlike at the beginning of the year, "nobody is really talking about a recession now." The US economy is performing better than many, including Williams, feared. In April, he said Trump's tariffs could push inflation to 4% and economic growth "slightly below 1%." (Jinshi)