The Fed reiterates it is still in wait-and-see mode until hard data prompts action
The May 2025 FOMC meeting was largely in line with expectations. Given the heightened uncertainty and lack of significant shifts in economic data, the Fed was expected to remain in its holding pattern. There were still some hawkish undertones, with Chair Powell balancing risks for both the Fed’s mandates hinting there may be a higher bar for any stronger easing and showing additional concerns about the second-round effects on inflation. Ultimately the course of the Fed will depend on the developments in hard data. Of course, given the current doubt about the economy, the uncertainty surrounding the Fed’s path also remains high.
For more, please see full note.