The investors were treated with another predictable FED meeting. The interest rates remained the same, which was anything but a certainty in advance of the decision on Wednesday. The Federal Reserve claimed its position that the economy was stable, even as the uncertainty of the participants.
Investors and managing directors could feel that the economy undertakes the edge of a knife, but the data that fed chairman Jerome Powell pointed out to a solid picture – although a cloudier one was before. Whether they are storm clouds or not is the critical question on the hand.
“The uncertainty about the economic prospects has decreased, but remains increased,” says a Fed declaration published after the meeting.
In view of the question of the interest reductions, the investors of the FED summary of the economic predictions by the FED, which is usually referred to as the “point list”. The hope is that the quarterly forecast of the Fed officials about the US economy, which includes expectations of interest rates, inflation and growth, will offer some references to its views for the economy. Since the FED is usually careful with regard to its prospects, investors often hope to let a better understanding of the fate of the US economy.
The median installment projection was for the cut in the quarterly rate in 2025.
The previous number of points published in March had the same middle projection. One of the main clockwork of this version was the expectation of a lower GDP growth and higher inflation in the course of 2025. At that time it was a significant development, since this meant that Fed not only regarded the possibility of these two undesirable changes, but also regarded them as a likely result of the economic path.
This means that it is worth remembering to remember the point is not an obligation for a certain amount of interest rate cuts. Rather, it is a collection of forecasts that the top Fed officials made at a certain point in time. It is important that it also does not say how certainly every official is in his forecast.
However, it is an important level of where the central bank sees a monetary policy. And at only six months a year, the timing for the installment rate that provides it (but not guaranteed) will only be narrower. At the moment the consensus seems to be that there will either be one or two installments.
For President Donald Trump, all of the interests of interest cannot come early enough. His criticisms of Powell have practically become an integral part of FOMC meeting. According to the President, interest rates should drop because inflation has not increased. And although this is true, the Fed is still hesitating to reduce interest rates, as it is not yet sure whether inflation rises again due to Trump’s tariffs.
So far, the Trump administration has made some progress in the trade agreements they promise – something that investors believed that they would calm the markets. The United States has announced that it signed a preliminary contract with Great Britain and, after two sessions, has signed a framework for a contract with China. While a welcome early sign that the United States could return to its previous role in the global economy, the two deals are far above the dozens that were promised by the White House. As a result, the uncertainty still remains.
At the same time, the geopolitical conflicts also risk the market – namely the military actions between Israel and Iran. The expanding conflict in the Middle East only worsens the tensions in an already volatile part of the world. Shipping by the Red Sea, the oil markets and the US military participation now remain open. Your potential answers are both diverse and significant – unrestricted news for those who are required for clarity.
