The rates are fed in the US unchanged, says uncertainty from potential tariffs | News of inflation
The Fed is in the holding pattern because it awaits more information on inflation and jobs and clarity on President Donald Trump tariffs.
Federal reserves of the United States hold interest rates of stable and have given little insight into it when the economy, in which the inflation remains above the goal, continues to reduce the costs of borrowing, continues, and the unemployment rate is low.
Fed announced his decision on Wednesday at the end of his last two -day meeting.
After a few months in which inflation information was mostly moved to the side, the US Central Bank descended from its latest language by a policy statement, saying that inflation “made progress” according to Fed’s goal of 2 percent, noting that the pace of price increase ” remains elevated “”
Recent readings of key inflation remain about half a percentage point or more above the goal of the Fed.
Fed officials say that they are largely believed that the progress of lowering inflation will continue this year, but now they have put rates on waiting while waiting for data to confirm them.
“Economic activity continued to spread with a solid pace. The unemployment rate has been stabilized at the low level of recent months, and the conditions in the labor market remain solid, “the Federal Committee of the Open Market at the Central Bank (FOMC) said.
“In considering the extent and time of additional adjustments to the target range for the federal funds rate, the Committee will carefully evaluate the incoming data, evolutionary chances and risk balance,” it is said.
The unanimous decision to retention of interest rates overnight in the current range of 4.25 percent to 4.5 percent, together with a new statement, puts the FED in the holding pattern because officials are waiting for further inflation and information on jobs and clarity on the impact of President Donald Trump’s policy.
Trump’s administration has already moved to deport Some unfathomrated immigrants and freeze federal consumption and could expand their reach to the involvement of new imported tariffs to the main trade partners, such as Mexico and Canada.
At a press conference on Wednesday, Feda Jerome Powell’s chairman mostly rejected questions about the recent Trump comments, including the one from last week, when Trump said he would lower oil prices and then “look for” lower rates. He also said he would talk to Powell about it.
“I will have no answer or comment on what the president said,” Powell said. Asked if Trump told his desire for lower rates directly Powell, the Feda chair said that “no contact”.
‘Mild hawk’
The decision to maintain a policy rate was stable after three consecutive decreasing rates in the 2024 year, which reduced the FEDA reference rate for a full percentage point.
The Central Bank discusses how much further rate may need, and policy creators envisage perhaps two quarters of a reduction in the rate during the year.
“The Fed seems to believe that the economy is stuck with the low unemployment rate and elevated inflation,” said Brian Jacobsen, the main economist in Annex Wealth Management. “The statement can be read as a treasure of strength, which suggests that a little twitching on the footsteps could throw an economy out of this equilibrium.”
Lindsay Rosner, head of investment in multiple sectors with a fixed income at Goldman Sachs Asset Management, said: “Although we continue with the thought that the FEDO’s mitigation cycle has not launched its course yet, FOMC will want to see further progress in inflation data to data rates, pointed out by the fact that they removed the reference to the advancement of inflation. “
Fed officials say that they want to see if inflation will continue to fall to the goal of the Fed in the months that are upcoming before mitigating monetary policy again, and at the same time expressing uncertainty about the effect of Trump’s plans on prices, labor market and economic growth.
