Overview

• The Fed maintained its target range for the federal funds rate at 4.25%–4.50% for the fourth consecutive meeting.
• Governor Christopher Waller told CNBC he believes the central bank could begin cutting rates as early as July to head off a potential labor market downturn.
• Chair Jerome Powell emphasized the bank would wait to see how Trump’s tariffs affect inflation before adjusting policy, aiming to distinguish one-off price shocks from sustained price pressures.
• In contrast, several European central banks, including the ECB, Bank of England, Swiss National Bank, Riksbank and Norges Bank, have cut their rates to support slowing growth and navigate trade uncertainty.
• Officials warn that holding rates too long may risk labor market stability, while cutting too soon could reignite inflation, underscoring the Fed’s challenge balancing its dual mandate.