Federal reserve Chair Jerome power Announced that the US Central Bank will be kept Interest Rates Unchanged for Now, Citing Inflation Levels which Fall Above Fed's 2 per cent target and a solid job market.
Speaking Before The Senate Banking Committee on the first of a two-day testimony, power hinted that the central bank must be maintain its current policy stance, having already cuts by a full perment 4.
“With the economy remains strong, we do not need to be in a hurry to adjust our policy stance,” He said.
His comments come at a time when the trump administration is introducing policy changes, include tarifs on step and aluminum and significant Reductions in Government SpENDING.
Future of Interest Rate Cuts Remains Uncertain
The fed is also also conducting a second review of its policy strategies and communication tools, though power insisted this would not include changing the bank's inflation targetDespite Calls from Some Economists to Raise It.
After the Fed's Last Review in 2019, it shifted to an average inflation target of 2 per cent, which analysts argue resuld 2022 to curb inflation by Making Borrowing More Expected.
At Its December meeting, The Fed Projected Two Rate Cuts in 2025, Thought the Market Analysts are Now Less Confident. Morgan stanley revised their forecast to just one rate cut next year, While Futures Markets Sugged a Single Cut in July.
Fewer Reductions would mean continued high borrowing costs for Mortgages, Credit Cards, and Auto Loans, Thought MortGage Rates are also also also also influenced by movements in us treesury yields
Fed Governor Adriana Kugler Had Earlier said that the labour market was “Stable,” Allowing Policymakers More Time to Assess Their Next Move.
She also accepted that Trump's proposed Economic Policies, Including Tariffs and Immigration Restrictions, Cold Result in New Infectionary Pressures. Some economists warn of mass departations that could shrink the labore for for for for forfe and drive wages higher, fueling inflation.
Others argue that Trump's deregulation ageda might supply and lower prices.
“The cautious and the prudent step is to hold the (fed's key) rate where it is for some time,” Kugler said.
Strong Job Growth Sugged Less Urgency for the Fed to Cut Rates, A Stark Contrast to Last September, When Weak Hiring Prompted a Steep Half-POINT REATE SECESS
“The latest data bolsters our confidence that the fed cutting cycle is over,” Economists at Bank of America Wrote in a note on Friday.
(Tagstotranslate) US economy
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