#FOMCMeeting Federal Open Market Committee (FOMC) Meeting😎😎😎
The Federal Open Market Committee (FOMC) meeting, scheduled for June 17-18, 2025, is one of the most important economic events, as investors and analysts await the U.S. central bank's monetary policy decisions, including interest rates and its economic forecasts.
🌟Key points expected at the June 2025 meeting:
♦️Interest Rate Hold: The vast majority of analysts expect the Federal Reserve to keep interest rates at their current level (4.25% - 4.50%). The CME Group's FedWatch Index indicates an approximately 99.9% probability of rates remaining on hold at this meeting. This is due to persistent inflation and growing uncertainty about the economic outlook, particularly due to the effects of recent tariffs.
♦️Economic Projection Update (Dot Plot): The meeting will release the "Summary of Economic Projections" (SEP), known as the "Dot Plot." This chart shows committee members' individual forecasts for interest rates, economic growth, inflation, and unemployment rates in the coming years.
♦️Rate Cut Forecasts: In the March 2025 forecast, the dot plot indicated two interest rate cuts in 2025. However, due to "persistent" inflation and the effects of tariffs, some analysts expect the new dot plot to indicate only one interest rate cut in 2025, or even no cuts at all this year.
♦️Growth and Inflation Forecasts: The forecast update is likely to show a downward revision to the GDP growth forecast for the last quarter of 2025 (around 1.2% per year vs. 1.7% in the March forecast), and an increase in the core inflation forecast for personal consumption expenditures (PCE) (to 3.0% per year vs. 2.8% in the March forecast). The path for the unemployment rate could also be adjusted slightly upward.
🌟Jerome Powell Press Conference: Following the meeting, Federal Reserve Chairman Jerome Powell will hold a press conference. His remarks will be eagerly awaited, as he will clarify the central bank's position and provide more details on his assessment of the U.S. economy and the future direction of monetary policy. Powell is expected to emphasize a "wait and see" approach, and that future decisions will depend on incoming economic data.
🌟This caution and this wait are due to several reasons:🤔🤔
✅Economic Uncertainty: Uncertainty regarding economic forecasts has increased, particularly due to the repercussions of recent tariffs and their potential impact on inflation and growth.
✅Persistent Inflation: Despite the Federal Reserve's efforts to contain inflation, it continues to show "persistence" in its decline towards the target level (2%).
✅Labor market: Despite some signs of easing, the labor market remains relatively solid, which could support inflation and reduce pressure on the central bank to lower interest rates quickly.
✅Political pressure: The Federal Reserve is facing pressure from the White House to urgently lower interest rates, but insists its decisions must be based on economic data.
The Federal Reserve is generally expected to hold interest rates steady at its June meeting, with a focus on the message it will deliver regarding its economic outlook and the direction of monetary policy in the coming months, particularly regarding the number of potential rate cuts in 2025. Markets will be sensitive to any change in the committee's tone or outlook.
