U.S.–China Tensions Loom as Fed Signals Rate Pause This Month 🇺🇸🇨🇳📉
📅 June FOMC Preview: The Federal Reserve is widely expected to hold interest rates steady at its upcoming FOMC meeting on Thursday, June 20, maintaining the current range of 4.25%–4.50%.
🔍 Market Outlook: According to the CME FedWatch Tool:
95.3% probability of no rate change
Only 4.6% chance of a 25 bps rate cut
This reflects strong market confidence that the Fed will stay the course amid economic uncertainties.
💬 Fed Commentary: Fed Governor Christopher Waller hinted that rate cuts are still possible later this year, but the central bank will closely monitor:
U.S.–China trade tensions
Labor market strength
Treasury holdings and overall economic data
🌐 Geopolitical Pressure: Renewed trade friction with China—including alleged violations of prior trade agreements—has reintroduced tariff uncertainty, clouding the Fed’s policy path.
🎯 Inflation Watch: Fed Chair Jerome Powell reaffirmed the commitment to returning inflation to the 2% target, emphasizing price stability as the core objective.
TL;DR: While a pause in June is likely, the Fed’s next move hinges on global trade dynamics and inflation data. Keep your eyes on both Beijing and Wall Street. 🧐