🚨 The officials of the Federal Reserve (FED), including Powell, have not clearly ruled out the possibility of an interest rate cut in July, emphasizing that the focus on current policy should not be overly concentrated on that. He noted that recent economic data and inflation trends could influence the decision to cut rates.
Nick Timiraos, the "spokesperson for the Federal Reserve (FED)", stated that Powell avoided a pointed question regarding the rate cut in July, refusing to rule out any possibility four weeks before the policy meeting. His general comments hardly suggest that he is preparing for a rate cut this month. The excessive focus on July (at least today) is inappropriate, as it might obscure the more subtle changes in the statements he himself and others have made in recent weeks. After the tariffs on the day of release, there was speculation that the price increase could be so significant that a rate cut would require substantial weakness in the labor market. However, recently, with the suspension of tariffs and the early (perhaps too early?) inflation readings not showing significant impact, Powell hinted that if inflation was not as concerning, a rate cut could be reinstated.
