Jerome Powell maintains a constant interest rate – and it searches through definitions by not raising prices

In fact, the Powers of Falcons were used to the dreaded word r (“lifting”)-after he suggested that he responds enough to calls “to look at” inflation caused by customs tariffs by not increasing interest rates, which is an idea that is likely to have it Send the oval office to anger.

While prices are fixed at 4.25 % to 4.5 %, the division between the FOOC Open Market (FOMC) is growing, with two members ’opposition. This represents the highest level of friction inside FOMC for more than 30 years.

But despite the pressure – from within the Federal and External Reserve Council – Powell hit a cautious tone on the pieces. For some time, analysts reduced September, the next meeting of FOMC.

Powell told reporters at a press conference after the meeting: “The high definitions began to appear more clearly at the prices of some commodities, but their total effects on economic activity and inflation still should be seen,” Powell told reporters at a press conference after the meeting. “There is a reasonable essential condition that the effects of inflation can be short-term-reflect on a single-time shift in the price level. But it is also possible that the inflationary effects are more stable, and this represents the risk of its evaluation and management.”

To the extent of the one -time price, Powell said FOMC responds to the advice not to leave the inflation related to the tariff cloud image of the basics of the economy.

But while investors used this argument to pressure to reduce, Powell said the fact that it is so The assimilation rate is fixed It is evidence of this pragmatism, saying that FOMC “is a little looking with enlarged goods by not raising prices.”

The increase in the average rate of average is the opposite of what many investors and economists hope, but Powell doubled: “The economy does not lead as if the restricted policy was inappropriately returning it.” Therefore, letting investors wonder about what FOMC will require to reduce it.

The total economy team at Bank of America wrote in a memorandum seen before luck. “Several questions were asked about what it takes to reduce the Federal Reserve in September. In response, Powell explained that the responsibility is On data to justify the September discount.”

They added: “In order to be clear, the increases are still very likely, but Powell argued that the” effective “way to balance the risks to the double mandate is to stay waiting because the cut is very early provides the risk of raising prices again later.”

The markets were thought of agreement with Bofa to take it from the Powers of the Falcons. The stock markets fell after the announcement, while the treasury revenues increased.

Elsewhere, Paul Donovan of UBS said that the markets may see through FOMC publications, explaining in the note this morning: “The President of the Federal Reserve Powell tried to present the views of the opponents that they are rationally dependent, but investors are looking to doubt that the logical basis has not been less than a tax on a little higher than jumping up to climb up and down, and cry out, choose me in the general direction For the house.

Holding in September

Although Powell’s speech erodes some confidence in the September reduction, analysts tend to adhere to the hope that the reduction in the next meeting comes after the next month.

The Federal Reserve Chairman gave them a reason for hope, for example saying: “We are also the ends of the risks on the employment side of our delegation.”

“The expectations in this meeting were not a price reduction, and I do not think that there was a lot of the upward trend of Powell’s indication that one was imminent,” said Elus Ausenbake, head of the investment strategy at JP Mortan Managemen, adding: “Data, as it is today, does not call for that yet, and a lot of time can change between now and the accuracy of the following decision in September.”

Likewise, David Merkel, the American chief economy in Goldman Sachs, wrote in a memorandum of customers luck: “No statement (Powell) nor the press conference gave any direct hints about the possibility of a reduction in September. In response to a question about the foundation line consisting of June, Powell admitted, but he refused to support, saying that he does not want to replace his own ruling on the opinions of other participants, especially with two other tour of the description and inflation data that still exists before he meets September.”

However, Goldman continues to predict three cuts in 2025: in September, October and December, followed by two others in 2026 to reduce the rate to 3 % to 3.25 %.

“Powell’s comments today indicate that the reduction in September is still sure to miss the discussion, but not to soften the labor market for the next two months is necessarily required, and we continue to see multiple tracks to reduce.”

Mark Hevelli, chief investment official in UBS wealth management, is considering agreeing to reduce interest rates in September – which controls job holes and employed employment (JLTS) that reveals a decrease in both openings and appointments, as well as a decrease in the rate of adherence.

Conference Council Consumer confidence scanning 18.9 % of the respondents also noted that the jobs were difficult to obtain in July, indicating that the warnings of the weak labor market may begin to harmonize.

Haefle wrote: “We still expect the Federal Reserve Bank to resume a policy of policy reduction in September, and reduce price rates by 100 basis points over the next 12 months. Investors must consider high -degree degree bonds and investment for a more permanent portfolio income.”