Fed’s Hawks Seize Spotlight Making Case Against a December Cut

A faction of Federal Reserve policymakers has stepped up warnings that inflation progress could slow or stall, casting doubt over the prospects for another interest-rate cut in December and laying bare a deepening divide at the central bank.

Officials broadly agree the labor market has cooled, but are split over whether the slowdown will intensify. And while one group is sanguine about price pressures, others are warning interest rates at the current level are barely restraining the economy and see further cuts putting progress on inflation at risk.

The public sparring is unusual. It reflects the difficulty of reading the ...