After concluding the meeting of the Federal Open Market Committee (FOMC), the US Federal Reserve released its second policy decision before 2025. The recent press release shows that the Federal Open Market Committee has chosen to keep the interest rates stable, so that they are maintained in the reach of 4.25% to 4.5%. This decision comes after the committee has chosen to lower the rates three times in a row last year.
Fed sees two cuts this year
By the conclusion Of the second of the eight planned meetings of the Federal Open Market Committee for 2025, which were completed on Wednesday, the panel decided to maintain federal funds against the existing target range of 4.25% to 4.5%.
In addition to their decision, Federal Reserve officials have revised their interest rate and economic predictions until 2027 and adjusted the speed with which they scale up the bond companies.
Despite the fact that uncertainties arise from the rates of President Donald Trump and an aggressive tax policy that includes tax cuts and deregulation, the officials expect a further reduction of rates by half a percentage point until 2025. The FED usually adjusts the rates in quarter percentage points, which suggests that two potential tariffs this year.
The post-meeting statement of the FOMC emphasized an increased level of uncertainty in the current economic environment.
Jerome Powell acknowledged that recent inflation data indicate considerable progress in the direction of stabilization, but he emphasized that the efforts of the central bank are underway. He stated that the interest rates would remain restrictive to prevent rising inflation, which is still somewhat increased.
The press release emphasized that recent indicators indicate a robust expansion of the economy. It noted that the unemployment rate has remained low and stable in recent months and that the circumstances on the labor market remain strong.
After the announcement, the price of BTC had a sharp rise, which now floated around $ 85k marking. It has registered a profit of more than 4.4% in the last 24 hours.
The total cryptomarkt remains stable
Cryptocurrency markets experienced minimal turbulence, largely because investors had already priced in the FED decision to leave the interest rates untouched.
This decision by the Federal Reserve comes in the midst of economic uncertainties that are driven early by trade tensions in the second term of President Donald Trump. Trump’s aggressive imposition of rates for steel, aluminum and many other imports has contributed considerably to volatility in global financial markets.
In addition to the last rate announcement, the FED has also revised its expectations for economic expansion, which indicates a more cautious prospect. The growth logs for this year were cut to 1.7%, which marked a remarkable decrease of 0.4 percentage point compared to the projection of December.
The inflation expectations, on the other hand, climbed somewhat somewhat, whereby core inflation is now expected to reach a percentage of 2.8% annually – a 0.3 percentage point of earlier estimates.
Interestingly, the newest projections of the Fed, shown in his ‘Dot -Plot’, suggest a movement to a tighter monetary policy compared to December. Earlier, only one official expected rate would remain unchanged in 2025, but now four officials share that opinion, which indicates a stronger preference for caution and possibly higher interest rates in the future.