The Fed's mandate goes both directions, without any external pressure. They have an optimal target rate for inflation and unemployment -- neither of which are "

The Fed's mandate goes both directions, without any external pressure. They have an optimal target rate for inflation and unemployment -- neither of which are "zero". When they get too far away from their target number, in either direction, they act. In this case, inflation is under 2% (or will be soon), and unemployment is already under 4%. There's no cause to panic, but they will act sooner rather than later so that it doesn't become time to panic. Sure, politicians and business types are always happy to have lower rates. It's free money. But the Fed is pretty insulated from them, by design. They're economists with a model of how the economy acts, and their behavior is in line with that model. They want to keep the economy on a moderate stable level of growth (~3-4% yearly GDP increase, not more and certainly not less). So it doesn't look like panic to me. It looks like the ordinary active management of an economy coming out of a recession. The key rate is at 5%, which is a huge amount of maneuvering room for them.