Powell's Lackluster Speech! The Fed Looks Helpless: I Can't Do Anything About Trump's Shenanigans ✂️

Federal Reserve Chairman Powell's recent remarks can be summed up in one sentence: **“There are too many issues, and it's hard for me.”** Below are a few key points from his press conference that will help you quickly understand the FOMC's attitude 👇

🗣 Highlights from Powell's Speech:

The root of inflation is not in employment; it's the “tariffs” at play. I can't control how Trump handles things; I can only watch his moves to decide whether to cut interest rates.

Employment is stable, inflation is also stable, and the overall economy is “behaving well,” not needing urgent action.

The tax rate is relatively high, which could drag out long-term inflation and should not be underestimated.

The threshold for cutting interest rates is unclear: What unemployment rate triggers it? He said: I don't know, we'll take it step by step and see which target (employment or inflation) veers off course first.

I'm not in a hurry to act: Although GDP declined in the first quarter (-0.3%), that’s due to import disruptions. The overall economy is fine; I have time to wait.

Stalled negotiations? I'm as steady as a rock: There are no results from US-China negotiations, and I can't assess the impact, especially since I can't even get involved.

Supply chain risks? Not my concern: With reduced shipments from ports and risks of shortages, old Powell shrugs: “That's not my responsibility; I only handle demand.”

🧾 Quick Overview of FOMC's Official Statement:

Interest rates remain unchanged: Continuing to hold at 4.25%-4.50%, unanimously approved, marking the third consecutive wait-and-see.

Labor market remains strong: Unemployment rate is stable, and the labor market is resilient.

Balance sheet reduction continues: The pace of reducing US Treasuries and MBS remains unchanged.

Inflationary pressures persist: Risks are rising, especially the “double whammy” of high inflation + high unemployment is worth noting.

Economic uncertainty is increasing: Although export data has been volatile, the overall situation remains “steady with strength.”

In summary:

Powell: “The economy is okay, inflation isn't small, negotiations have no results, and I'm not moving.”

The reality is: When Trump moves, Powell will have headaches.