On May 8, 2023, the Federal Reserve FOMC meeting confirmed that there will be no rate cut in May. What about the outlook for June?

The independent existence of the Federal Reserve is to make cautious judgments about the economy; it prefers to move slowly, and no one will blame it. Therefore, it is unlikely to cut rates in June unless there is clear economic data proving that it must do so (of course, much of the data is often embellished to prepare for decision-making).

Currently, although tariff information has been digested, the 90-day tariff delay still exists, and uncertainty remains because Trump knows that negotiations are a game of tug-of-war, requiring both sides to consider each other, which is a very lengthy process.

Is it possible to resolve the tariff negotiations before the June Federal Reserve meeting? Obviously not. Therefore, the Federal Reserve will continue to wait for certainty regarding tariffs to capture the certainty of a rate cut. However, inflation rates currently appear stable, while US Treasury bonds seem unstable. Under significant pressure, the Federal Reserve can signal the market, as it is important for the market to hear the Federal Reserve's voice: It’s too expensive!