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Markets price in fewer rate cuts as Fed holds on tariff uncertainty, persistent inflation

Markets price in fewer rate cuts as Fed holds on tariff uncertainty, persistent inflation

By Swedan Margen

Fashion

Industry watchers expect that lack of clarity over Trump’s policies will continue to weigh on US central bank’s movements

GLOBAL markets are pricing in fewer rate cuts for the year as the US Federal Reserve unsurprisingly kept rates on hold on Wednesday (Jan 29).

In the first Federal Open Market Committee meeting of the year, the Fed kept rates steady, and repeated that it was “in no hurry” to adjust its policy stance.

“We’ve long said persistent inflation pressures would prevent the Fed from cutting far or fast – and that this would not be a typical rate-cut cycle, but a fine-tuning of the policy stance. That is what is now materialising,” said Jean Boivin, head of the BlackRock Investment Institute.

Markets have been adjusting to high-for-longer in recent months, and are now pricing just two Fed rate cuts this year, with the next one not until June, he added.

Keeping an eye on changes

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Originally published by businesstimes.com.sg. Syndicated material does not necessarily reflect the views of Grazia British.

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