Fed may delay rate cut after meeting this week

The US Federal Reserve (Fed) is likely to keep interest rates unchanged this week, amid concerns about the impact of White House policies on the US economy .

The Federal Open Market Committee (FOMC), the Fed’s monetary policy-making body, will hold its second meeting this year. Experts expect that the Fed will likely keep the federal funds rate unchanged at 4.25% to 4.5%, The Hill reported on March 18. Investors will continue to monitor developments from Fed Chairman Jerome Powell’s press conference after the FOMC meeting ends on March 19.

Economists are closely watching President Donald Trump’s trade policy, which has rattled markets with its tariffs. A delay in cutting interest rates could expose the Fed and its chairman, Jerome Powell, to criticism from Trump.

US Federal Reserve Chairman Jerome Powell

When the Fed postponed a rate cut in January, Mr Trump accused central banks of “not stopping the problem they created with inflation”, although he later acknowledged that cutting rates “was the right thing to do”. Mr Powell has refused to respond to the White House boss’s criticism.

After this week’s meeting, the Fed will release its economic forecast for the end of 2025, which will include plans for interest rate adjustments. In its December 2024 forecast, the Fed projected two quarter-point rate cuts this year, up from its previous estimate of four. Analysts from Deutsche Bank and JP Morgan also expect the Fed to stick with its two quarter-point cuts, while also expecting inflation to rise slightly and economic growth to slow.

White House reassures, Wall Street worries about risk of US economic recession

Mr. Trump has repeatedly emphasized that the tax policy will have some impact on the US economy before showing any effectiveness. The US leader's stance is to impose import taxes to shift business activities to the US and create jobs for domestic people.

Source: https://thanhnien.vn/fed-co-the-hoan-giam-lai-suat-sau-cuoc-hop-tuan-nay-185250318194405867.htm