LAST MINUTE: FED Chairman Jerome Powell is making critical statements live after the Interest Rate Decision! LIVE

After the FED kept interest rates steady, FED Chairman Jerome Powell is making critical statements at a live press conference.

Here are the key excerpts from Powell’s statements:

• The economy is in a strong condition.
• Inflation continued to hover slightly above the targets.
• The current policy stance places us in a favorable position.
• Unusual fluctuations in net exports complicate the GDP calculation.
• Inflation has decreased but is still above the targets.
• It is still unclear how market sentiment will affect spending.
• Concerns regarding trade policy have led to a deterioration in market sentiment.
• The unemployment rate is fluctuating within a narrow range and at low levels.
• Labor market conditions continue to show a strong trend.
• Many indicators show that the economy is close to its maximum employment level.
• It is expected that the overall personal consumption expenditures index will increase by 2.3% in May, while the core index will increase by 2.6%.
• Inflation expectations have risen recently, and the main reason for this is customs duties.
• Most long-term inflation indicators are consistent with the target.
• There is still uncertainty regarding changes in trade policy and fiscal policy.
• The labor market appears balanced and is not a source of inflationary pressure.
• The impact of customs duties will depend on their level. This year, the increase in customs duties may exert pressure on economic activity and push inflation up.
• Avoiding persistent inflation ultimately depends on keeping long-term inflation expectations stable.
• The impact of customs duties on inflation may be longer-lasting.
• There may be some tension between dual mission objectives.
• The current conditions we have are favorable, and we can make the necessary adjustments after gathering more information.
• The FED will work intensively to prevent a one-time inflation from turning into a fundamental situation.
• There is uncertainty in the forecasts of the FOMC policymakers, and this uncertainty is extraordinarily high.
• Commodity prices have recently shown a slight increase, and this trend is expected to continue in the summer months.
• It will take some time for customs duties measures to be reflected to consumers.
• We have started to see some effects of customs duties and we expect more impact in the future.
• We cannot assume that inflation will rise as predicted and then fall.
• As we gather more information, we believe it will be appropriate to maintain the current interest rates.
• While focusing on the FED’s policy path predictions, we should focus on the short term; long-term predictions are more difficult.

You can also access the new statements made by Powell by refreshing this page.

Federal Open Market Committee (FOMC) left the interest rate unchanged at its June meeting. However, attention was focused on the published economic projections rather than the interest rate decision.

The FOMC’s economic forecasts still predict that there could be two interest rate cuts in 2024, although this expectation has weakened. According to the new projections, nine committee members, which was eight in the previous meeting, believe that this year there will either be no rate cuts or only one will be appropriate.

FED officials predict that inflation and unemployment will rise in the coming period, while economic growth is expected to slow down. The decision to keep interest rates unchanged was made unanimously.

Another striking statement in the committee’s announcement was the assessment that “the uncertainty regarding the economic outlook has decreased, but is still high.” However, this view has been deemed controversial by some circles; as uncertainties in trade policies, the effects of the budget law on public finances, and ongoing geopolitical tensions continue to keep risks alive.

While two interest rate cuts were previously projected for 2026, this number seems to have been reduced to one. The expectation for 2027 remains unchanged with a single interest rate cut, while the forecasted interest rate for that year has been raised from 3.1% to 3.4%. There is notable divergence in long-term interest rate projections.

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