The Federal Reserve could resume the trimming of interest rates in June, operators bet on Tuesday after a survey that showed that consumer’s confidence collapsed this month, and inflation expectations increased.
It is likely that Federal Reserve resume The cut of interest rates In June and could reduce the short -term indebtedness costs again in September, the operators bet on Tuesday after a survey that showed that consumer confidence collapsed this month, and inflation expectations increased.
The trust of American consumer deteriorated to His most acute pace after years and a half in Februaryshowed the Conference Board survey, reflecting the growing anxiety of Americans on the economic impact of President Donald Trump’s policies. At the same time, the average inflation expectations of consumers rose to 6%, the highest level since May 2023.
The projections on the Fed change
Interest rate futures contracts now value the possibility of the Fed in more than 70% Reduce the cost of credit in a quarter percentage point at its June meeting, to a range of 4.00%-4.25%, and cut it again as soon as in September.
The bets suggest that the operators believe that in June the concern of the Central Bank for the possible weakness of the labor market will be greater than the concern for the resurgence of inflation, which will lead them to respond with a relaxation of monetary policy.
Fed’s own monetary policy managers said they are looking for more evidence than Inflation is addressed again to its 2% target before feeling comfortable by cutting the types.
They cite uncertainty about how tariffs planned by Trump, tax cuts, immigration repression and the current reductions of the federal workforce will affect prices, economic growth and labor market.
Source: Ambito
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