US Federal Reserve He announced that he met market expectations by keeping interest rates constant. What was interesting this time was the number of people who opposed a policy of forward easing.
The FOMC decided to keep its target range for the federal funds rate between 3.5 percent and 3.75 percent.
Those who voted to keep rates steady became Presidents Jerome Powell, John Williams, Michael Barr, Michelle Bowman, Lisa D. Cook, Philip Jefferson, Anna PaulsonAnd Christopher Waller.
Stephen Miran, who voted against the resolution, opted to lower the federal funds rate target range by 1/4 percent at this meeting. Beth Hammack, Neel KashkariAnd Lorie Logan He supported keeping interest rates steady but did not support including an easing trend in the statement at this time.
Inflation rose while employment remained stable; The annual inflation rate in the US rose to 3.3% for the 12 months ending March, from 2.4% previously.
The war in the Gulf has raised oil prices, which in turn could raise the prices of all goods and services. Tariff and economic environments can be difficult to decipher. If the conflict with Iran continues, inflation could rise further.
Lately, Kevin Warsh He was approved to serve as the new chairman of the Fed. There is some expectation that Warsh will be inclined to cut interest rates, but markets are already signaling a preference for higher interest rates.
Part of the challenge is that the White House wants the cost of living to fall, especially in the housing/mortgage market. However, markets are doing their part and not listening much to political statements, and many indicators point to inflation rising.
Powell has been criticized by President Trump for keeping rates high, including an ill-fated investigation. US Department of Justice Concerns about cost overruns for the Fed’s renovations have put the current President on the defensive. At the press conference held after the interest rate decision, there were intense discussions on the importance of the Fed’s independence.
Although Warsh explained that President Trump understands the importance of the Fed’s independence, the President’s past demands belie the existence of a potentially rocky relationship between the White House and the central bank.
