In the May 2025 FOMC meeting, the Federal Reserve maintained the target range for the federal funds rate at 4.25%-4.5%, in line with market expectations. The meeting signaled a policy shift, for the first time explicitly indicating a possible rate cut within the year, but emphasized that combating inflation remains the top priority. The core PCE price index dropped to 2.3% in April, close to the 2% target, but a 2.8% wage growth rate shows persistent inflationary pressure in the service sector. Powell warned at the press conference that 'the inflation risk has not been fully alleviated.'

Regarding policy tools, the Federal Reserve announced a reduction in the monthly balance sheet contraction from $60 billion to $30 billion, causing the 10-year U.S. Treasury yield to drop by 12 basis points. This move aims to ease market liquidity pressures while addressing the impact of the BRICS countries' cross-border payment systems on the dollar's dominance. The dot plot shows that most officials expect two rate cuts in 2025, but the timing of the cuts may be delayed until June or later, with the market's expectation of a 25 basis point cut in June rising to 57.8%.

In terms of economic outlook, the Federal Reserve lowered its GDP growth forecast for 2025 from 2.1% to 1.7%, raised the unemployment rate forecast to 4.4%, and for the first time acknowledged that 'the uncertainty of the economic outlook has significantly increased.' The meeting paid special attention to the potential impact of Trump's tariff policy on inflation, with Powell stating, 'Tariffs may push up commodity prices, but we need to observe their persistence,' suggesting that policy will remain flexible to respond to external shocks.

This meeting marks the Federal Reserve's difficult balance between controlling inflation, stabilizing growth, and responding to changes in the monetary system. Powell stated, 'The Federal Reserve is no longer the only main player globally, but it remains an indispensable anchor,' highlighting its cautious stance amid multiple challenges. #美联储FOMC会议