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🎯Traders are betting that the Federal Reserve will slow the pace of interest rate cuts this year, as the economy continues to hold up, forcing policymakers to wait longer before accelerating monetary easing further in 2026.

🕤Just one day before the release of the latest monetary policy decision from the U.S. central bank, financial markets were pricing in three quarter-point cuts this year, which is one cut less than the expectations at the beginning of April. An additional half-point cut is expected in 2026, which is the highest level of cuts anticipated in the current cycle.

🕵️Traders will focus their attention on the remarks of Federal Reserve Chair Jerome Powell on Wednesday, as the central bank is expected to keep the benchmark interest rate steady between 4.25% and 4.50%, looking for signals about whether President Donald Trump's economic policies are prompting policymakers to adjust their outlook on the timing of further cuts.