- Almost all of the Wall Street expected Fed It would stand on the financial policy since current economic data remains stronger. Poor conditions can involve tariffs and lead to “stagnation,” high price combinations and increased unemployment that puts the central bank in difficult situations.
Federal Park It is still moving interest rates in 2025 while the central bank goes on “Wait-and-see“The way of President Donald Trump's impact Taxes.
After Wednesday's meeting, the Central Bank announced that it would set the federal financial level, which the bank uses to borrow from its counterpart immediately, between 4.25% and 4.5%. The Federal Park continues to wait Great transparency About where the economy can be directed if you are given all the changes to the American business policy.
“The uncertainty about the economic perspective has increased,” Fed said in a statement released on Wednesday.
The hold rates were almost completely expected. Almost all of the Wall Street expected The Fed would stand on the financial policy since current economic data remains stronger.
“Inflation photo is still elevated by Nata and unemployment continues to be inside, so Fed has no key ingredients,” Chris Brigati, Chief Investment Officer at Texas Insurance Company and SWBC financial services, wrote in a letter on Wednesday morning.
Trump Tax Tax Mandatory marketing Earlier last month and has led to popular steps of Consumer feedback Slipping. The latest version of The beige bookA summary of economic activity and conditions from the Fed region banks, emphasized the “uncertainty” uncertainty and a negative attitude.
These bad vibes have not yet been able to spread to what economists call “hard data,” important economic measures that dictate Fed decisions. April stronger than expected Work report He insisted Obvious resilience of the American economy, which increased 177,000 positions instead of 135,000 which the road expected. At the same time the unemployment rate remained unchanged by 4.2 percent.
And while the Fed Inflation Measurement He came By 2.3% in March, its lowest rate since inflation increased by a four-year decade in 2021-22, remaining above the 2% Central Bank's target. Then there is a possible effect of Trump's tariffs.
Fed chairman Jerome Powell has confessed to the Central Bank will look at the same time, or “Transitory“Increasing prices from increased tariffs on imports. In a Speech Last month at Chicago's economic club, however, he said Trump's latest tariffs could lead to inflation and slow growth if they remained at their current levels.
“At this time, we are good to wait for more transparency before we consider any correction of our policy position,” he said.
Is it? What will Fed do in the future?
Powell's views touched on the negative state of the so -called “Trembling“While inflation is increasing but unemployment also increases. Powell agreed that would set two types of” tension “as the Central Bank rises interest rates to fight for high prices but reduces them to stimulate economic activity.
“We continue to believe that the Fed will prioritize protecting the labor market later this year, with when hard data will turn,” Mike Sanders, chief of permanent revenue in Madison's investment, wrote in a letter on Wednesday morning.
Entering Wednesday's conference, traders were priced at 98% of the unchanging Fed Care rates, according to the CME group of the CME group Fedwatch tool. The currency expectations have put the probability of approximately 70% on the Central Bank to do the same thing in June and are priced in two to four cuts at the end of the year.
“The tax situation is very waterproof and unpredictable,” Brigati wrote, “so it would be responsible for the Fed to try to be responsible for tariffs when the situation could change dramatically and their actions may lack the intended effects or they show the worst effect.”
Powell has also noted this type of business policy lacks modern introduction. The overall rate of good tariffs in the United States is now 28%, its highest rate since 1901, According to Yale's budget laboratories.
Trump's rule has sent Mixed messages About the prospects for trade agreements in recent weeks, but Treasury Secretary Scott Bessent and American business representative Jamieson Greer will meet with their Chinese counterparts this week. It is the first step to exacerbate the tension after America has imposed 145% tariffs on many goods from China, resulting in Beijing to avenge 125% of tariffs on American imports.
Powell and Fed have been constant It is criticized And Trump, who has been insisting on wanting to reduce the cost of borrowing for Americans. However, the President has recently supported threats of burning the Fed Chairman, which took investors amid the fear of the Central Bank Freedom valued It can be subject to threat.
This story was previously shown Bahati.com
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