7 May 2025 at 02:45 UTC
💹How are Economic Data and Inflation Shaping the Outlook?
This week, financial markets are keenly $SOL $BNB focused on the upcoming FOMC Federal Funds Rate decision, the FOMC statement, and the subsequent FOMC press 💹conference. Significant uncertainty surrounds US interest rate projections due to the ongoing divergence between market expectations and the Federal Reserve's outlook for the remaining part of 2025 and early 2026. A key point of division within markets is how tariffs will influence the overall US economy. Recent data revealed a slowdown in US GDP for the first quarter of 2025, largely attributed to a surge in imports driven by tariff front running. Conversely, the US job market has shown strength, and inflation, measured by the Core PCE, the FED’s preferred inflation gauge, has been slightly lower.💲
🟢Specifically, the US nonfarm payroll in April exceeded forecasts, although some views suggest that the strength may not last, while the March’s Core Personal Consumption Expenditure (Core PCE) M/M dropped to 0.0% from 0.3% and the Y/Y was 2.3% compared to 2.5%. Market participants are split on the Federal Reserve's potential rate cuts, with some anticipating faster cuts due to the slowing economy and low inflation, while others believe concerns about tariff-induced inflation will lead to slower cuts.
