Fed holds rates steady at the top of the neutral range | Forex Factory

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  • Fed holds rates steady at the top of the neutral range

    From think.ing.com

    The Federal Reserve held policy rates steady in a 10-2 vote as widely expected. Both Governors Stephen Miran and Chris Waller voted for 25bp cuts as we suspected. Remember this is Stephen Miran’s last meeting with his term ending on Saturday. Chris Waller’s name continues to be mentioned in connection with the Fed Chair position, but he is now seen in a distant third place behind both Rick Rieder and Kevin Warsh by prediction markets. The key takeaway is a slightly hawkish twist to the accompanying statement and press conference. At the December FOMC meeting, officials stated that, "downside risks to ... (full story)

This widely anticipated decision reflects the Fed's cautious stance in light of persistent inflationary pressures, especially within services, despite a cooling trend from peak PCE levels. With strong labor market conditions and steady economic growth reducing the need for immediate intervention, the central bank is prioritizing sustained evidence that inflation is converging to 2%. As a result, any potential rate cuts are now more likely to be delayed until later in the year, such as July or September, unless incoming data shows a marked change.
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