Economic Data Suggests the Fed Will Continue to Wait and See

By Felix Richter – Statista

Ahead of this week’s meeting of the Federal Open Market Committee, the question is not so much whether the Fed will cut its policy rate now (almost certainly not), but more whether Jerome Powell and his colleagues still expect to make any downward adjustments this year at all. According to the projections released after the FOMC’s March meeting, nine of the 19 committee members expected two 25-point cuts by the end of 2025, while two Fed officials expected three cuts, four expected just one and another four didn’t foresee any changes at all this year.

In his press conference after the latest meeting, Fed Chairman Jerome Powell, who’s under intense pressure from President Donald Trump to further cut interest rates, told reporters that the Fed was in a very good position to wait and see, as none of the Fed’s two goals, i.e. maximum employment and 2-percent inflation, appeared to be out of sight under current conditions. With both the unemployment rate and CPI inflation relatively stable since March at 4.2 and 2.4 percent, respectively, there’s little reason to believe that Powell and his colleagues will come to a different conclusion this week.