The Open Market Committee (FOMC) of the Federal Reserve will not change the key interest rate at its May, which begins today and ends on Wednesday, according to the general opinion of analysts in the United States.
The President of the Federal Reserve (Fed) Jerome Powell has repeatedly rejected the pressure of the US President Donald Trump to lower a key interest rate to encourage economic growth. As Powell explained, the Central Bank will wait until the consequences of the Trump Customs Policy are clearer.
Customs could jeopardize economic growth, while inflation is expected due to the expected shortage of goods and higher prices. This is currently under control and close to the goal of the central bank of two percent of the year of inflation, and the American economy slightly decreased in the first quarter of this year.
Morgan Stanley Analysts agree that the central bankers are best to wait until the consequences of Trump’s customs shock are clearer. They even predict that the FED will not change its key interest rate by the end of this year.
As before, Fed shares will depend on the development of events, especially the situation in the labor market. Most of the other analysts do not exclude a reduction in the key interest rate this year, but everyone agrees that this May Meeting on Monetary Politics will be “boring”, seeing SEEbiz.,
After a series of increasing the key interest rates from March 2022. until July 2023, the FED did not change the monetary policy until September 2024, when it lowered the key interest rate by 0.50 percentage points, and then again in November and December 2024. For 0.25 percentage points. Since then, a key interest rate is at the level of 4.25 and 4.50 percent. Until the end of the year, another five meetings of the FOMC are planned.
