It’s the question that looks likely to dominate the run-up to the Federal Reserve’s next meeting: Will it cut interest rates by a quarter-percentage point or twice that?

As reported by Bloomberg, fresh from their June gathering, when they indicated a potential willingness to reduce rates for the first time in a decade, some Fed officials have in recent days publicly discussed how far they may go. For now, though, investors are no wiser about just what policy makers will do when they meet again in the final days of July.

Minneapolis Fed President Neel Kashkari got things started June 21 by announcing he had argued already for a 50-basis-point move, to prevent inflation from slipping further. Expectations were bounded by his counterpart from St. Louis, James Bullard, who said June 25 that a half-point cut would be “overdone.” Those comments caught the market’s attention because he voted in June for an immediate reduction.

“The fact that Bullard, one of the leading doves who dissented in favor of a 25-basis-point cut in June, is not ready to back a 50-basis-point cut in July must cool speculation of a double-sized reduction at that meeting,” said Krishna Guha, head of central bank strategy at Evercore ISI.

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