Fresh tariffs amid high inflation are making the Fed’s job uniquely difficult and feeding uncertainty about what to expect for interest rates this year.
With healthy hiring and some progress on inflation, Fed official have said that the pace of rate cuts will slow this year.
The Federal Reserve is expected to keep its key interest rate unchanged this week, despite Donald Trump's calls for cuts.
Fears of elevated interest rates dampened the mood on Wall Street at the start of this year–but cooling core inflation and dovish comments by Federal Reserve governor Christopher Waller have given investors reason to feel a bit more cheerful this week.
The S&P 500 gained 1% on Friday, capping off the last trading day of Biden's presidency and marking the best week since the election.
Since officials first cut rates in September, inflation has made uneven progress back down toward the central bank’s target. Meanwhile, investor expectations of inflation one and two y
President Donald Trump may want lower interest rates, but the Federal Reserve will almost certainly keep its benchmark interest rate unchanged at its two-day policy meeting that ends.
Fixed-income analysts and central bankers care about what’s driving the Treasury bond yield, and it’s something called the term premium. That’s the technical phrase for the amount of interest investors demand over and above where the Federal Reserve sets rates. Recently it’s been rising quickly.
The Fed maintained the monthly cap on the amount of Treasuries it allows to mature each month without being reinvested at $25 billion, while keeping the cap for mortgage-backed securities unchanged at $35 billion.
Policymakers said they “will carefully assess incoming data, the evolving outlook, and the balance of risks” in determining future rate decisions.
Powell said the Fed is awaiting to see what policies are enacted by the newly inaugurated Donald Trump administration.