The Fed’s hawks are starting to waver. What it could mean for interest rates.

Federal Reserve officials are sharply divided about how much to cut interest rates this year. The difference isn’t only about where officials expect rates to be at year end. It is also about policymakers’ conviction in getting there.

Ten members of the Federal Open Market Committee indicated in September that they thought the Fed should cut rates twice more by year end. Two members indicated they favored one more cut, and seven wanted to keep rates where they are.

The Fed lowered the federal-funds rate by a quarter of a percentage point, to a target range of 4% to-4.25%, at its September meeting because of concerns about growing labor-market weakness. Investors are expecting another quarter-point cut in October, based on futures-market pricing.

Those pushing for more easing, including New York Fed President John Williams, Governor Michelle Bowman, and newly appointed Governor Stephen Miran, have grown more confident that inflation is contained and that the bigger risk now lies in a weakening job market. The officials arguing to pause are less certain. In speeches and interviews over the past week, they hedged and added caveats to their stance, indicating some reluctance to plant a flag.

The minutes from the Fed’s September meeting, released Wednesday, highlighted the divide. A narrow majority supported at least two additional rate cuts this year, saying the balance of risks had shifted toward employment and that policy remained restrictive even after September’s first move. A sizable minority preferred to hold steady, warning that inflation remained elevated and that employment was still relatively solid.

Vice Chair Michael Barr told an audience in Minnesota on Thursday that the Fed should “move cautiously," warning that inflation could remain above target for some time. The Fed, he said, “should be cautious about adjusting policy so that we can gather further data, update our forecasts, and better assess the balance of risks."

Atlanta Fed President Raphael Bostic told Barron’s this week that while he still views inflation as the more pressing issue, he is listening to colleagues who warn about the employment outlook. “If enough people are saying this, I shouldn’t ignore it," he said “I’m still more worried about inflation, but it’s a narrower margin."

The St. Louis Fed’s Alberto Musalem also warned this past week that the Fed should “tread with caution" on rate cuts. But he indicated that he would be open to further cuts if data show they are necessary.

Minneapolis Fed President Neel Kashkari also seemed unsure of what comes next. “The big question is, will tariff inflation be short-lived or sticky?" he said on Tuesday. “It’s too soon to reach a firm conclusion."

By contrast, the doves seemed steadier in their convictions.

Williams told the New York Times he supports additional easing as “risk management," arguing that labor-market weakness poses the bigger threat. Bowman and Miran, both appointed by President Donald Trump, have been even more explicit, saying current policy is already restrictive enough and that keeping rates too high for too long risks doing unnecessary damage to employment.

Miran said on Tuesday that he believes interest rates need to come down quickly. He was the sole dissenter at the Fed’s September meeting, arguing for a half-percentage-point cut.

Chair Jerome Powell said in his post-September-meeting press conference that few officials have “great confidence" in their forecasts. Asked whether policymakers had conviction in their projections, he said forecasting was “particularly challenging" in the current environment.

Markets also have more dovish conviction. Futures still price in roughly two more quarter-point cuts this year.

The Fed’s internal divide might look nearly even, but one side sounds more certain. That conviction could be what shapes policy at the Fed’s Oct. 28-29 meeting.

Write to Nicole Goodkind at nicole.goodkind@barrons.com.