As expected, the Federal Funds Rate remained unchanged. However, Jerome Powell’s press conference was more significant than the decision itself. The chairman has not yet signaled the end of the fight against inflation. Interest rate cuts will occur when the Federal Reserve is confident that inflation is under control and on track to the 2 percent target. An interest rate cut is unlikely to occur at the next meeting in March. Expectations for the first rate cut have therefore been pushed to May. Despite high interest rates, the US economy remains strong, fulfilling the “soft landing” scenario. As a result, the Federal Reserve appears to be in a more comfortable position than the European Central Bank and can continue to focus on bringing inflation to the target.
Bartosz Wałecki, Analyst Michael / Ström Dom Maklerski
