Fed Outlook: A Pause, Not A Stop

2025-01-31 20:15:00 ET

Summary

• The Fed’s January pause reflects a balancing act - assessing the impact of prior easing while navigating growth resilience and new inflation risks.
• While the path ahead for rates is clouded by uncertainty around the Trump administration’s policies, the bias is still for further cuts.
• In Q4 2024 the U.S. economy grew 2.3%, slightly above trend, so the immediate need for further policy loosening is not obvious.

By Seema Shah, Chief Global Strategist

The Fed’s January pause reflects a balancing act - assessing the impact of prior easing while navigating growth resilience and new inflation risks. While rate cuts remain likely given still-restrictive policy and ongoing economic fragilities, Trump administration policy uncertainty could cloud the picture. With no urgency to move, the Fed is keeping its options open, making the path ahead highly uncertain....

Read the full article on Seeking Alpha

For further details see: