Fed Chair Jerome Powell communicated to Senators that the timeline for cutting interest rates remains uncertain. While he did not confirm that a rate cut will occur in July, he hinted that if inflation pressures stay contained, a cut could happen sooner rather than later. The odds of a 25-basis point cut at the upcoming Federal Open Market Committee (FOMC) meeting have slightly increased, reflecting investor speculation based on Powell's remarks. Annual inflation currently exceeds the Fed's 2% target, but has shown limited increases. Powell's testimony emphasized the importance of monitoring economic conditions before making policy adjustments. Analysts note that while tariffs were expected to impact prices, recent economic readings suggest stability. Powell's comments were echoed by two Fed governors advocating for a July rate cut unless inflation rises significantly, with upcoming economic reports being crucial for future decisions. Meanwhile, market indices showed modest growth, with the S&P 500 nearing an all-time high.

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