Federal Park has has not yet cut interest rates Because the economic forecast predicts “a meaningful increase in inflation during this year,” chairman Jerome Powell said during the meeting of the meeting on Tuesday.
So far this year the Fed has not touched interest rates, setting its target at its current rate between 4.25% and 4.5%, which has been since July 2023.
The decision to hold the scale of the scale was obtained Powell Ire of President Donald Trump. Since taking office, Trump often Claims Low interest rates. In a social media post on Tuesday, ahead of the Powell conference testimony, Trump said he believes interest rates should be “two to three points” than their current standards.
“I hope Congress really works this dumb man, with a hard head,” Trump wrote. “We will be paying for its inability for many years to come.”
During Powell's testimony before the Housing Financial Services Committee on Tuesday, members of the Congress – most of the democracy – strongly asked the chairman for his views on Trump's details and policies, especially on trade and immigration. Powell refused to comment on a regular basis, saying it was “inappropriate” to the Central Bank to comment on the policy decisions of elected officers.
Powell has insisted that the Fed wants to wait for the cutting of the rate until the future of the economy becomes clear.
“The standards will depend on the economic path, and that is very unknown,” Powell said.
Lack of economy increased in all boards after Trump Tax Policywhich improved international markets. Stock Markets have healed more from April of hell when they CRATERED On fear the world's business would be disrupted. During this period of turmoil, Powell repeatedly pointed to the fact that basic data, such as inflation and unemployment rate, were strong. That, Powell said, he gave the Fed time to wait before making a decision.
The main question remains that the “time, amount, and patience” of any influence is increasing from Trump's tax policy, Powell said. The expectation is that the tariff will surely lead to a one -time spike at a price that stabilizes. The fear is that it is not done and prices remain high, or even continue to rise.
Despite the tariffs being implemented in April, Powell said he did not expect their impact – as they could not be – start trading with consumers until the heating season. Many importers were already full before the tax policy, but as the calculations decrease they would have to start buying imported goods.
“I think we didn't expect this so far,” Powell said. “Now we are starting to think it's time for us to see (the effect). And if we don't see it, that will care. If we see it, that will care. So we have taken a precautionary approach to not reduce our policy level until we have more confidence on the pixels and as the effect of smoking.”
The way to wait and see Powell has made him a few friends in the White White House. The president, never a person for political principles, despised the tradition by fully focusing on monetary policies, usually stored only by the non -political federal conservation board. Sometimes Trump was even talking about firing Powell. Immediately he even floated the possibility of appointing himself as a Fed chairman.
Defendants of cutting rates immediately believe it will help boost the economy and end the estimated growth after tariffs put brakes on business investment. After the price of the most recent users Report Earlier this month he showed prices exceeding only 0.1 percent, Vice President JD Vance joined Trump in calling him Powell.
“The president has been saying this for a while, but it is more clear: Fed's refusal to reduce rates is money fraud,” Vance He wrote On X.
An unknown concentration of individual Fed Officers' predictions for 2025, released last week, showed average expectations were With a dual reduction The end of the year.