#FOMCMeeting The Federal Open Market Committee (FOMC) is convening its May 2025 meeting today and tomorrow (May 6–7). Markets widely anticipate that the Federal Reserve will keep interest rates steady at 4.25%–4.50%, maintaining a cautious stance amid economic uncertainties such as President Trump’s tariff policies and persistent inflationary pressures.  

Key Expectations from the FOMC Meeting

• Interest Rates: The Fed is expected to hold rates steady, with a 94% probability of no change. 

• Economic Outlook: Despite a 0.3% GDP contraction in Q1, strong job growth in April (177,000 jobs added) and elevated inflation suggest the Fed will maintain its current policy stance. 

• Future Rate Cuts: While the Fed projects two rate cuts later in 2025, the timing remains uncertain due to factors like inflation and economic growth. 

Market Reactions

• Equities: Major U.S. indices are slightly down ahead of the meeting, reflecting investor caution. 

• Cryptocurrencies: Bitcoin and other major cryptocurrencies have experienced modest declines, with analysts attributing the dip to market anticipation of the Fed’s decision. 

• Gold: Gold prices have risen to a two-week high, driven by safe-haven demand amid tariff threats and the upcoming Fed decision. 

What to Watch

Federal Reserve Chair Jerome Powell’s press conference following the meeting will be closely monitored for insights into the Fed’s future policy direction. Markets will be particularly attentive to any signals regarding potential rate cuts in the coming months.