Markets are looking at a certain possibility that the Fed will keep interest rates unchanged tomorrow, while the words of the institution's president Powell are also eagerly awaited. It raises the question of when Powell will signal a rate cut.
Fed reporter: They would have lowered interest rates if there were no tariffs.
Nick Timiraos, a Wall Street Journal writer known as a "Fed reporter" who has gained a reputation for knowing news in advance on many occasions, stated in his article today that the tariffs have caused fear.
"It is unpredictable what future inflation will be. Researchers conduct surveys for this. Expectations are very important for the Fed. Because expectations play a major role in determining current inflation. As UBS economist Alan Detmeister said; 'If everyone expects inflation to go up, then it will go up'... That's what the Fed fears. If retailers think prices will go up tomorrow, they will reflect this on their prices today. Landlords do the same with rents. Workers ask for a raise, thinking that their expenses will increase. That's why the Fed wants to see the impact of tariffs on the economy. The 'wait-and-see' strategy continues"
"A rebate in interest rates could also lead to sharper increases"
Timiraos stated that according to some experts, it would be more correct for the Fed to do nothing at the moment and used the following expressions:
"According to some experts, it is correct for the Fed not to take any action at the moment. Because recently, some businesses may continue the price increase habits they acquired during the high inflation period this summer as well. This could lead to prices rising rapidly again. Expectations are always showing an increase. If the Fed lowers interest rates, mortgage rates and corporate investments may be positively affected. However, if this situation leads to a resurgence of inflation, then heavier interest rate hikes may be necessary later."
As is known, Donald Trump has stated that the Fed urgently needs to cut interest rates and even recently used the phrase "a 100 basis point rebate is needed."
Trump and Powell had a meeting at the White House in the past weeks.
Published: June 17, 2025 13:49
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Detail on interest rate rebate from Fed reporter: "Fed is scared"
Markets are looking at a certain possibility that the Fed will keep interest rates unchanged tomorrow, while the words of the institution's president Powell are also eagerly awaited. It raises the question of when Powell will signal a rate cut.
Fed reporter: They would have lowered interest rates if there were no tariffs.
Nick Timiraos, a Wall Street Journal writer known as a "Fed reporter" who has gained a reputation for knowing news in advance on many occasions, stated in his article today that the tariffs have caused fear.
"It is unpredictable what future inflation will be. Researchers conduct surveys for this. Expectations are very important for the Fed. Because expectations play a major role in determining current inflation. As UBS economist Alan Detmeister said; 'If everyone expects inflation to go up, then it will go up'... That's what the Fed fears. If retailers think prices will go up tomorrow, they will reflect this on their prices today. Landlords do the same with rents. Workers ask for a raise, thinking that their expenses will increase. That's why the Fed wants to see the impact of tariffs on the economy. The 'wait-and-see' strategy continues"
"A rebate in interest rates could also lead to sharper increases"
Timiraos stated that according to some experts, it would be more correct for the Fed to do nothing at the moment and used the following expressions:
"According to some experts, it is correct for the Fed not to take any action at the moment. Because recently, some businesses may continue the price increase habits they acquired during the high inflation period this summer as well. This could lead to prices rising rapidly again. Expectations are always showing an increase. If the Fed lowers interest rates, mortgage rates and corporate investments may be positively affected. However, if this situation leads to a resurgence of inflation, then heavier interest rate hikes may be necessary later."
As is known, Donald Trump has stated that the Fed urgently needs to cut interest rates and even recently used the phrase "a 100 basis point rebate is needed."
Trump and Powell had a meeting at the White House in the past weeks.
Published: June 17, 2025 13:49