The Attacks in the Middle East Could Make It Harder for the Fed to Cut Rates
- Amid rising tensions in the Middle East following Israel's unprecedented strike on Iran, market observers anticipate that the Federal Reserve will maintain its current interest rate levels during its upcoming policy meeting.
- Federal Reserve officials have maintained their current policy stance as they monitor the impact of the administration's broad policy adjustments and ongoing trade uncertainties on economic growth and inflation trends.
- U.S. employers added 139,000 jobs in May and the unemployment rate remained steady at 4.2%, reflecting a resilient labor market despite geopolitical risks and tariff concerns.
- An Israeli attack sent oil prices up nearly 9%, prompting warnings from economists that elevated energy costs could push inflation higher, complicating the Fed’s decision on future rate cuts.
- The conflict and its impact on energy prices suggest the Fed will likely adopt a cautious approach, delaying rate cuts until risks from tariffs and geopolitical tensions become clearer.
16 Articles
16 Articles
After the growing unrest in the Middle East with the conflict between Iran and Israel at the end of last week, the American interest rate decision will be in the spotlight next Wednesday. The Bank of England (BoE) and the Bank of Japan will also give clarity on the interest rate.
The attacks in the Middle East could make it harder for the Fed to cut rates
President Donald Trump has repeatedly demanded the Federal Reserve slash interest rates. But Fed officials have stood pat, waiting to see how his administration’s sweeping policy changes affect the economy first.
Concerns about a worsening of the situation in the Middle East are currently dominated by movements on the capital markets.
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- 73% of the sources are Center
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