#PowellRemarks Here’s a refined summary of Federal Reserve Chair Jerome Powell’s most recent remarks during and after the FOMC session on June 18, 2025:
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🏦 Key Highlights from Powell’s Press Conference
1. **Rates held again with future path “foggy”**
The Fed kept the policy rate steady at 4.25–4.50%, emphasizing that the future rate path remains unclear, highly dependent on incoming data, especially regarding inflation and the economic effects of newly imposed tariffs .
2. Tariffs flagged as inflation risk
Powell warned that new tariffs—set to take effect after July 9—will likely boost prices. He noted uncertainty about whether these will cause just a one-off price increase or a deeper, more persistent inflationary trend .
3. Downward revision in growth projections, upward in inflation
The Fed trimmed its 2025 GDP forecast from ~1.7% to 1.4%, while elevating core PCE inflation outlook to around 3.1%, reflecting growing stagflation concerns .
4. Dot plot still forecasts two cuts—but timing uncertain
Though most FOMC members still expect two rate cuts this year (totaling a 0.5% reduction), Powell was cautious, saying their projections reflect the “least unlikely path,” not a firm plan. Financial markets are pricing for a first cut around September .
5. Emphasis on data-driven policy, not politics
He reinforced the Fed’s independence from political influence (including President Trump’s calls for immediate cuts), asserting that decisions will be based on economic and inflation data .
6. Middle East tensions noted—but seen as manageable
Powell acknowledged geopolitical risks, particularly from the Iran‑Israel conflict, but suggested energy markets may not face severe disruptions given U.S. diversification .
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🧭 Market Reactions & Implications
Dollar strengthened due to safe-haven flows amid tariff and Middle East concerns .
Treasury yields fluctuated, with short-term yields dipping post-announcement then recovering as Powell struck a cautious tone