Fed keeps interest rates steady at 4.25%-4.50%, plans for two rate cuts, cautious optimism.

From Quiver Quantitative: 2025-06-19 01:32:00

The Federal Reserve kept interest rates steady at 4.25%-4.50%, citing economic uncertainty related to tariffs and inflation. Despite plans for two rate cuts this year, projections show a slower pace for future easing due to elevated inflation pressures from trade policies. Forecasts predict GDP growth slowing to 1.4% by year-end with rising unemployment at 4.5%. Inflation expectations are revised to 3% for 2025. The Fed remains committed to gradually returning inflation to their 2% target over the next few years, balancing inflation control and economic growth amidst external risks. Market reaction has been cautiously optimistic, with stocks holding gains and bond yields stabilizing. Fed Chair Jerome Powell emphasized readiness to respond flexibly to economic shifts, while criticisms from President Trump for more aggressive rate cuts highlight tensions between fiscal and monetary policy.



Read more at Quiver Quantitative: Fed Holds Interest Rates Steady, Signals Two Rate Cuts Amid Inflation Concerns