US Fed leaves rates unchanged, says uncertainty from potential tariffs
1 month, 3 weeks ago

US Fed leaves rates unchanged, says uncertainty from potential tariffs

Al Jazeera  

US Fed is in a holding pattern as it awaits more inflation and jobs data and clarity on President Donald Trump’s tariffs. After several months in which inflation data has largely moved sideways, the US central bank dropped from its latest policy statement language saying that inflation “has made progress” towards the Fed’s 2 percent inflation goal, noting only that the pace of price increases “remains elevated”. The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid,” the central bank’s policy-setting Federal Open Market Committee said in a statement. In a news conference Wednesday, Fed Chair Jerome Powell largely deflected questions about recent comments from Trump, including one from last week, when Trump said he would lower oil prices and then “demand” lower rates. “The statement could be read to be mildly hawkish, suggesting that a little jolt to rates could kick the economy out of this equilibrium.” Lindsay Rosner, head of multi-sector fixed-income investing at Goldman Sachs Asset Management, said, “While we continue to think the Fed’s easing cycle has not yet run its course, the FOMC will want to see further progress in the inflation data to deliver the next rate cut, highlighted by the fact they removed the reference on inflation making progress.” Fed officials say they want to see if inflation continues to fall to the Fed’s target in the months ahead before easing monetary policy again, while also expressing uncertainty about the effect Trump’s plans will have on price pressures, the labour market and economic growth.

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