US Fed opens policy meeting, set to hold rates steady

CENTRAL BANK SEEN HOLDING STEADY DESPITE TRUMP CRITICISM, INTERNAL DIVISIONS

The Fed has signalled it is waiting on the effects of Trump’s sweeping tariffs on allies and competitors alike to begin to show up in economic data.

As the central bank mulls changes to monetary policy, officials are seeking a balance between price stability and maximum employment.

Analysts are expecting to see some dissent from Fed policymakers at the end of their meeting Wednesday, given that a couple of officials have signalled openness to rate cuts as soon as in July.

“It will be interesting to watch whether Powell alludes to some potential policy easing before year-end,” or if he avoids explicit forward guidance given differences among the Fed’s rate-setting committee, said EY chief economist Gregory Daco.

“With no imminent need to act, and a fractured FOMC facing asymmetric risks, the Fed will likely wait until September to deliver the next 25 basis points rate cut,” Daco added, referring to the Federal Open Market Committee.

The Fed said Governor Adriana Kugler would not be attending the meeting “due to a personal matter.”