May 8th Federal Reserve FOMC meeting, no rate cut in May has become a certainty, what about the outlook for June?
The independent existence of the Federal Reserve is to make cautious judgments about the economy, it would rather move slowly than be blamed by anyone, so it is unlikely to cut rates in June unless there is clear economic data proving it must do so (of course, most of the time, the data is also embellished to prepare for decision-making).
Currently, although the tariff information has been digested, the 90-day tariff delay still exists, and uncertainty remains because Trump himself knows that negotiations are a game where both sides need to consider pulling and dragging, which is very lengthy.
Will the tariff negotiations be resolved before the June Federal Reserve meeting? Clearly not possible. Thus, the Federal Reserve will continue to wait for the certainty of tariffs to capture the certainty of rate cuts. However, currently, inflation rates appear to be stable, but U.S. Treasury bonds seem unstable. Given the significant pressure on the Federal Reserve, it is okay to let the market know something and give some signals; after all, for the market, the Federal Reserve's voice is: it's too expensive!
