The Difficult Position of the Fed: What to Expect from the May FOMC Meeting

Due to the divergence between 'soft' and 'hard' economic data, a decrease in interest rates may be delayed for several months.

Key Takeaways

At its May meeting, the Fed is likely to keep interest rates unchanged, as Trump's tariffs have clouded the economic outlook.

'Soft' economic data is worsening, but 'hard' data still looks strong.

As the impact of tariffs on the economy is highly uncertain, markets expect a rate cut in July, but some strategists say it may take longer.