US Fed Poised to Hold Rates Amidst Economic Health, Political Pressure
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Moneycontrol•28-01-2026, 23:06
US Fed Poised to Hold Rates Amidst Economic Health, Political Pressure
- •The US Federal Reserve is expected to keep short-term interest rates unchanged, prioritizing economic observation over White House pressure for cuts.
- •Despite three rate cuts last year to bolster the economy, signs of stabilization in unemployment and improving economic health support maintaining current rates.
- •Inflation remains stubbornly above the Fed's 2% target, further justifying a hold on rate adjustments.
- •Fed Chair Jerome Powell faces internal division on future rate cuts and external pressure from the Trump administration, including subpoenas and attempts to dismiss a governor.
- •Economists predict potential rate cuts later in the year, possibly around June, as consumer spending may increase due to tax refunds and the economy continues to grow.
Why It Matters: The US Fed is likely to maintain current interest rates for months, balancing economic health with political pressure.
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