Fed Holds Rates at 3.50%-3.75% for Fifth Meeting; UOB Foresees 2027 Cuts
The Federal Reserve kept its key rate unchanged at 3.50%-3.75% for a fifth straight meeting, with three dissenting votes favoring a cut. UOB analysts expect an extended pause until 2027 before policy easing begins.
The Federal Reserve held the federal funds target rate steady at 3.50%-3.75% for the fifth consecutive meeting, extending its policy pause. Three FOMC members dissented, reportedly favoring a rate reduction, but the majority opted to wait.
Analysts at UOB, Suan Teck Kin and Alvin Liew, view this as the start of a prolonged pause. They expect rates to stay on hold throughout 2025 and 2026, with the first cuts not arriving until 2027, reflecting a cautious stance amid mixed economic signals.
The decision underscores the committee's data-dependent approach and ongoing concerns about inflation persistence.
Source: FXStreet Forex News