Overview

• The Federal Reserve is expected to keep its benchmark rate at 4.25%–4.50% for a fourth straight meeting.
• Policymakers cited uncertainty over President Trump’s tariffs as a key reason to defer further rate changes.
• Escalating Israel-Iran conflict has driven oil prices to near five-month highs, intensifying inflation risk.
• The Fed’s updated dot plot may reflect a more hawkish stance with fewer rate cuts projected for 2025.
• Money markets currently price in about 46 basis points of cuts by year-end while awaiting the Fed’s new economic projections.