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No Rate Cut Expected Today: Here’s Why the Fed Is Likely to Hold Steady
As the Federal Reserve prepares to announce its interest rate decision today, analysts and traders widely agree on one thing: a rate cut is highly unlikely. While internal disagreements and political pressures persist, the broader economic picture favors patience over action.
🔹 Why a Rate Hold Is Expected
🧮 1. Market Expectations Are Clear
According to the CME FedWatch Tool, there's a 97% probability that the Fed will keep rates unchanged at 4.25%–4.50% today. The consensus leaves little room for surprises.
🏛️ 2. Fed Leadership Favors Stability
Most Federal Reserve officials—including Chair Jerome Powell—have stressed the need for more economic data before taking any easing measures. This cautious stance remains consistent with prior meetings.
📊 3. Inflation Is Still a Concern
Core inflation stood at ~2.9% in June, notably above the Fed’s 2% target. That gives policymakers reason to delay cuts and avoid sparking renewed price pressures.
🔸 Internal Dissent & Political Pressure
❗ 1. Minority Push for a Cut
Two Fed governors—Christopher Waller and Michelle Bowman—are likely to dissent, advocating for a 25 basis point cut. Their rationale: early signs of a softening labor market and muted inflation pass-through from tariffs.
🇺🇸 2. White House Influence
President Donald Trump has publicly pushed for rate cuts, even criticizing Chair Powell. However, the Fed has reiterated its independence, insisting that decisions will remain data-driven, not politically motivated.
📈 Looking Ahead: September Cut in Focus?
With no change expected today, market attention now shifts to September. The Fed’s own projections suggest two cuts possible later in 2025, but only if inflation cools and labor market weakness becomes more pronounced.
🔍 What to Watch During Powell’s Press Conference
Today’s real insight may come not from the decision itself, but from what Powell says afterward. Key points to monitor:
Outlook for September: Any signals on whether easing is truly on the table
Data Dependence: Emphasis on upcoming CPI, employment, and GDP figures
Fed’s Reaction Function: Clues on how closely the Fed is watching political and external pressures
📝 Summary: Rate Hold Expected, Eyes on September
Expected Action: Hold rates at 4.25%–4.50%
Dissenting Votes: Likely from Waller & Bowman
Next Key Window for Easing: September 2025, if data supports it
Main Message: The Fed remains focused on inflation, labor, and its own credibility
#FedMeeting #FederalReserve #InterestRates #FOMC #JeromePowell #RateCut #Macroeconomics #USInflation #CentralBankPolicy #EconomicOutlook #FEDDATA #FedRateDecisions
🔹 Why a Rate Hold Is Expected
🧮 1. Market Expectations Are Clear
According to the CME FedWatch Tool, there's a 97% probability that the Fed will keep rates unchanged at 4.25%–4.50% today. The consensus leaves little room for surprises.
🏛️ 2. Fed Leadership Favors Stability
Most Federal Reserve officials—including Chair Jerome Powell—have stressed the need for more economic data before taking any easing measures. This cautious stance remains consistent with prior meetings.
📊 3. Inflation Is Still a Concern
Core inflation stood at ~2.9% in June, notably above the Fed’s 2% target. That gives policymakers reason to delay cuts and avoid sparking renewed price pressures.
🔸 Internal Dissent & Political Pressure
❗ 1. Minority Push for a Cut
Two Fed governors—Christopher Waller and Michelle Bowman—are likely to dissent, advocating for a 25 basis point cut. Their rationale: early signs of a softening labor market and muted inflation pass-through from tariffs.
🇺🇸 2. White House Influence
President Donald Trump has publicly pushed for rate cuts, even criticizing Chair Powell. However, the Fed has reiterated its independence, insisting that decisions will remain data-driven, not politically motivated.
📈 Looking Ahead: September Cut in Focus?
With no change expected today, market attention now shifts to September. The Fed’s own projections suggest two cuts possible later in 2025, but only if inflation cools and labor market weakness becomes more pronounced.
🔍 What to Watch During Powell’s Press Conference
Today’s real insight may come not from the decision itself, but from what Powell says afterward. Key points to monitor:
Outlook for September: Any signals on whether easing is truly on the table
Data Dependence: Emphasis on upcoming CPI, employment, and GDP figures
Fed’s Reaction Function: Clues on how closely the Fed is watching political and external pressures
📝 Summary: Rate Hold Expected, Eyes on September
Expected Action: Hold rates at 4.25%–4.50%
Dissenting Votes: Likely from Waller & Bowman
Next Key Window for Easing: September 2025, if data supports it
Main Message: The Fed remains focused on inflation, labor, and its own credibility
#FedMeeting #FederalReserve #InterestRates #FOMC #JeromePowell #RateCut #Macroeconomics #USInflation #CentralBankPolicy #EconomicOutlook #FEDDATA #FedRateDecisions
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content. See T&Cs.
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