💸 **Fed's balance sheet decreased by $1.7B in one week!**
📌 **Daly, Fed Chair**
- More than two rate cuts may be needed this year.
- Decisions should be based on likely scenarios.
- Tariffs are unlikely to cause sustained price increases.
- The labor market is weakening, and further slowdown would be undesirable.
📌 **Kashkari, Fed Chair**
- The economy is slowing, and two rate cuts this year still seem appropriate.
- Changing the rate path may be better than waiting.
- The impact of tariffs on inflation is unclear, but signs of slowdown are already evident.
📌 **Bostic, Fed Chair**
- One rate cut this year remains the baseline, but more data will be available before September.
- Labor market risks are now significantly higher than before the last meeting.
- Tariffs may have a longer and more complex effect than expected.
📌 **Mester, Fed Chair**
- The labor market is near full employment, but economic growth is weaker, posing risks to jobs.
- The inflationary impact of tariffs is likely to be short-lived.
📊 **Market expectations (Fed rate):**
- **September 17:** Cut by 25 bps to 4.00-4.25%.
- **October 29:** Cut by 25 bps to 3.75-4.00%.
- **December 10:** Cut by 25 bps to 3.50-3.75%.
- **January 28, 2026:** PAUSE.
- **March 18, 2026:** PAUSE.
- **April 29, 2026:** Cut by 25 bps to 3.25-3.50%.
- **June 17, 2026:** PAUSE.