(Bloomberg) — Federal Reserve Chair Jerome Powell is expected to push through another quarter-point interest-rate cut this week despite growing unease among fellow policymakers that inflation remains too high.

The Fed delivered a second straight reduction in October driven by the summer’s sudden deterioration in the US labor market. But that was followed by an outburst of hawkish concern from some officials, including five who vote on policy this year, signaling hesitancy or unwillingness to support a third move in December.

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That growing division has been exacerbated by the lack of fresh economic data due to a government shutdown that spanned much of October and November. The latest inflation number now in policymakers’ hands, released on Dec. 5, is for September — a report that is unlikely to alter the policy debate.

Against that backdrop and for about a week in mid-November, investors signaled serious doubt over the prospect of another cut. But the unusual level of drama was resolved on Nov. 21 when New York Fed President John Williams, who is seen as closely aligned with Powell, said he saw room for a reduction in the “near term.” The market took the signal and now assigns more than a 90% chance to a move next week.

Economists polled by Bloomberg then expect the Fed to take a break before two more reductions in 2026, in March and September. And there’s some hope that a flood of new data — as statistical agencies catch up from the shutdown — will resolve the ongoing tension between the Fed’s mandates to contain inflation and maximize employment.

That said, more Fed drama lies on the horizon. President Donald Trump is expected soon to name a successor to Powell, whose term as chair expires in May. Kevin Hasset, a Trump loyalist and senior economic adviser, is the frontrunner. That’s prompted worries among some investors that the next chair will pursue rate cuts at Trump’s direction and risk spurring inflation.

“If Powell leans hawkish at the news conference to appease hawkish regional Fed presidents, will it even matter anymore? After all, the next Fed chair — Hassett is the frontrunner — could join the board as soon as February, rendering Powell essentially a lame duck for the last few months of his chairmanship.”

—Anna Wong, Stuart Paul, Eliza Winger, Estelle Ou, Chris G. Collins, Alex Tanzi and Troy Durie.

In contrast to the Fed, the Bank of Canada is expected to keep its rate steady at 2.25%. Officials have said that’s “about the right level” as long as economic and inflation forecasts materialize.

While third-quarter growth blew past expectations, that was largely driven by lower imports and a jump in military spending, while household consumption declined. Inflation is close to target at 2.2%, though core measures remain elevated.

Elsewhere, central bank decisions from Australia to Switzerland to Brazil will draw attention, and euro-area finance chiefs are scheduled to elect a new chair.

The week in Asia kicks off with economists expecting Japan to revise third-quarter gross domestic product to show a deeper contraction after recent capital spending data for the period were weak, in a report that will justify the government’s large fiscal stimulus package unveiled last month.

Also Monday, data for October may show real wages falling for a 10th month, underscoring how steady gains in nominal pay aren’t keeping up with inflation.

Data Wednesday are expected to show a modest improvement for China’s price environment in November, with inflation ticking up to 0.7%, the fastest advance since February 2024.

Factory-gate prices are seen falling 2%, in what would be the slowest decline in 15 months. Still, as the CPI got a holiday boost that will likely fade, the figures may prompt Beijing to enact more anti-involution policies to curb price competition.

India also may show a pickup in inflation on Friday, with consumer price gains estimated to have accelerated to 0.75% in November, still well below the Reserve Bank’s 2%-6% target range.

Australia releases the NAB Business Confidence index for November Wednesday and a blast of labor statistics on Thursday that will show if jobs data stayed strong after robust results in October.

New Zealand’s manufacturing PMI gauge may have remained in expansionary territory for a fifth month in November. Trade data are due during the week from China and Taiwan.

In central banks, the Reserve Bank of Australia is seen holding its cash rate steady at 3.6% on Tuesday, extending a pause after three cuts earlier this year.

Focus will be on any signaling that the easing cycle may have run its course, with pricing in the swaps market already mostly reflecting expectations for a hike by September.

In the Philippines, authorities are likely to continue their easing campaign with a cut to the overnight borrowing rate to 4.5% on Thursday.

The Swiss National Bank will draw the spotlight among a series of monetary decisions in the region on Thursday. The outcome will showcase the tradeoff for officials trying to avoid a return to negative borrowing costs in Switzerland.

The central bank is widely expected to keep its rate at zero, but may acknowledge a weaker price outlook after every inflation reading since the last quarterly decision turned out weaker than expected, weighed down by the strength of the franc.

By contrast, Turkish policymakers may cut borrowing costs by as much as 150 basis points in its own final decision of 2025. Growth has slowed more than expected and the latest inflation reading there was lower than any estimate in a Bloomberg survey.

In Serbia, the central bank may extend its rate pause to a fifth quarter as US sanctions shut down the nation’s only refiner, risking a rise in energy prices. And Ukrainian officials will announce their own policy decision after keeping borrowing costs steady for 5 months.

Among data highlights, the UK’s monthly growth number on Friday will focus investors. GDP is predicted by economists to have increased slightly at the start of the fourth quarter, in the last such data release before the Bank of England’s decision. Meanwhile Norwegian inflation is scheduled for Tuesday.

Turning to the euro zone, industrial production numbers in Germany on Monday and Italy on Wednesday will reveal whether manufacturing began staging any sort of recovery at the start of a quarter that officials are hoping will mark a turning point.

Among European Central Bank speakers scheduled are President Christine Lagarde at an event on Wednesday. A blackout period will begin the following day in advance of the monetary decision just over a week later.

In France, the country’s fiscal woes will return to the fore on Tuesday, with a National Assembly vote on social security scheduled for Tuesday. Premier Sebastien Lecornu pulled off a win last week by clinching agreement over the revenue part of that measure.

And euro-zone finance ministers will select one of their own to chair meetings and represent them collectively after the abrupt departure of Ireland’s Paschal Donohoe. Belgium’s Vincent van Peteghem and Greece’s Kyriakos Pierrakakis will face off in a vote when the group meets on Thursday.

Mexico’s monthly inflation data will likely see both headline and core readings creep back up from the current 3.57% and 4.28% respectively.

While both are above policymakers’ 3% target ahead of Banxico’s Dec. 18 rate decision, most Mexico watchers expect the lurking threat of recession to win the case for a 12th straight rate cut.

Brazil’s market readout from the central bank may see some additional improvement in inflation expectations for this year and next ahead of Wednesday’s November consumer prices report and rate decision.

The headline reading for last month posted early Wednesday is very likely to have slowed for a second month, and very possibly below the 4.5% top of policymakers’ tolerance range though still well over the 3% target.

Hours later, there’s almost no chance that Banco Central do Brasil does anything but hold at 15% for a fourth meeting, but the odds are much better for some substantive guidance from bank chief Gabriel Galipolo and colleagues.

President Javier Milei’s long slog to bring Argentine inflation to heel continues this week, with the November monthly print expected to slow from October’s 2.3% reading, bringing the annual rate within hailing distance of 30%.

Peruvian central bankers can take a bow for the lowest inflation rate among LatAm’s major economies but won’t likely take that for granted at December’s monetary policy meeting Thursday.

Caution likely has bank chief Julio Velarde and his board keeping the key rate at 4.25% for a third meeting.

—With assistance from Brian Fowler, Laura Dhillon Kane, Robert Jameson, Mark Evans and Piotr Skolimowski.

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