highlights high uncertainty over inflation, with price increases largely reflecting tariffs.
- *Rising Downside Risks to Employment*: The labor market is softening, with hiring below breakeven, but other job indicators remain stable.
- *Rate Cut Aim*: The recent rate cut aimed to move policy toward neutral, amid slowing consumer spending and uncertain business outlook.
- *No Risk-Free Path*: Powell reiterates that there is no risk-free policy path ahead, with near-term risks to inflation tilted to the upside and risks to employment to the downside.¹ ²
*Market Impact* 📈:
- *Interest Rate Cuts*: The Fed's cautious approach to future rate cuts may impact market expectations and economic growth.
- *Inflation Target*: Long-run inflation expectations align with the 2% target, but inflation remains elevated relative to this goal.
*What's Next?* 🔮:
- *Economic Developments*: The Fed will carefully assess incoming data and economic developments to determine future policy actions.
- *Uncertainty Ahead*: With uncertainty surrounding inflation and employment, the Fed's policy path will be closely watched by markets.³
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