Overview

• The Federal Reserve left its benchmark rate unchanged at 4.25%–4.50% for a fourth straight meeting, maintaining its wait-and-see stance
• FOMC projections raised end-2025 inflation to 3.0% from 2.7% and trimmed U.S. growth for 2025 to 1.4% from 1.7%
• The median forecast of two quarter-point cuts this year remains, but seven of 19 officials now expect no further easing in 2025
• Chair Jerome Powell cautioned that President Trump’s tariffs and the Iran-Israel conflict could fuel more persistent price pressures
• Markets price the first cut at the September 16-17 meeting and a second reduction before year-end