1/ 🏦 U.S. Federal Reserve Meeting – June 18, 2025
The Federal Reserve decided to maintain the interest rate at 4.25% to 4.50% for the fourth consecutive time amid mixed economic indicators.
2/ ❓ Why was it held steady?
The Federal Reserve indicated a state of uncertainty due to geopolitical tensions (especially in the Middle East), tariff costs, alongside a slight slowdown in inflation.
3/ 🔻 Cuts are still on the table
Forecasts suggest two rate cuts during the second half of 2025, but there is a division within the bank; 7 out of 19 members prefer to keep the rate unchanged.
4/ 📊 Key economic updates:
Expected GDP growth rate: 1.4% (down from the previous forecast of 1.7%)
Unemployment may reach 4.5%
Core inflation (PCE): at around 3%, higher than the 2% target
5/ 🛢️ Tariffs are putting pressure on inflation
Jerome Powell stated clearly: "Someone will pay the price of the tariffs" - referring to the fact that their impact will reach consumers soon.
6/ ⚖️ Continued balancing policy
The Federal Reserve affirmed its commitment to its tasks: supporting employment and maintaining price stability. It clarified that it will respond to new data as necessary.
7/ 📅 Market reaction
Markets have not seen sharp movements, but they are anticipating the first rate cut at the September 2025 meeting, provided inflation continues to decline and the labor market stabilizes.
📌 Summary:
Interest rate held steady for the fourth time
Expectations for a subsequent cut later this year
Weaker growth and slightly higher inflation
Tariffs are an impending threat
The next decision depends on economic data
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