Fed Will Not Cut Interest Rates in May 2025

In the context of the U.S. economy maintaining steady growth, the Federal Reserve (Fed) is likely to not implement a rate cut in this May meeting. The decision to keep interest rates unchanged is deemed reasonable as inflation has not yet reached the target of 2% and the labor market remains quite strong.

According to the latest data, the unemployment rate remains low at 4.2%, and wages continue to grow, indicating that demand in the economy shows no clear signs of weakening. Meanwhile, inflation, although slightly decreasing to 2.4%, is still not enough for the Fed to have a strong basis to ease monetary policy.

Additionally, although President Trump has called on the Fed to act to support growth, Chairman Jerome Powell affirmed that the Fed will make decisions based on actual data rather than political pressure. This stance shows that the Fed still prioritizes controlling inflation rather than hastily stimulating the economy by reducing interest rates.

While the market expects a rate cut in 2025, experts agree that that moment will come later, possibly in July or September, if economic indicators show more pronounced signs of weakness.

In summary, in the current context, the Fed is nearly certain to keep interest rates unchanged in May 2025, waiting for additional data to ensure that monetary policy remains on track and sustainable.