What Could Push Jerome Powell to Cut Rates?
Fed Chair Jerome Powell is holding off on cutting interest rates — but here’s what might change that:
🔹 Tariffs & Inflation
Powell expects new tariffs to cause a temporary spike in inflation.
🗣 “If we make a mistake, people will pay the cost for a long time.”
🔹 June CPI Report Is Critical
• A strong reading (≥0.2%) could delay any cuts.
• A soft print (like May’s 0.1%) might open the door to a July rate cut.
🔹 Labor Market as a Wild Card
• Unemployment is low (4.2%), but cracks are showing:
– Slower hiring
– Rising jobless claims
– More people collecting unemployment
📅 Next Fed meeting: July 29–30
➡️ If inflation cools or jobs data weakens, a rate cut may come sooner.