Fed funds rate unchanged

Investment Analysis Clubs Macro Economic Trends and Risks
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The markets expected the Federal Reserve to hold the fed funds rate steady so there was no surprise.

https://www.wsj.com/economy/central-banking/fed-holds-rates-steady-and-keeps-door-open-to-cuts-5d523f9f?mod=djemalertNEWS

Fed Holds Rates Steady and Keeps Door Open to Cuts

Officials are waiting to see if businesses manage higher costs from tariffs by trimming profits or pushing up prices

By Nick Timiraos, The Wall Street Journal, Updated June 18, 2025

WASHINGTON—Federal Reserve officials left the door open to cutting interest rates in the second half of the year when they agreed to hold rates steady Wednesday.

President Trump pre-emptively blasted the widely anticipated rate decision earlier in the day and called for much more dramatic cuts of between 1 and 2.5 percentage points. The Fed left its policy rate in a range between 4.25% and 4.5%…

Trump said he wanted big rate cuts so that it will be easier for the U.S. Treasury to issue less expensive long-term debt. [The fed funds rate is an overnight rate. The bond market determines the yield on long-term debt, not the Fed. If the bond market thinks that future inflation will rise (e.g. if the Fed cut the fed funds rate prematurely) the yields on long-term debt would rise. – W]…

The new interest-rate projections highlighted a divergence among the 19 Fed officials who participated in the meeting. Ten of them expect the central bank to cut rates at least twice this year, a narrower majority than in March, and two penciled in one cut. Meanwhile, seven penciled in no changes this year, up from just four in March.… [end quote]

Unless things change there is no reason cut the fed funds rate. Overall financial conditions are loose and trending looser.

Wendy

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Which is a big problem.
National debt:

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Fed Fund rate:
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Yup, another one of many disconnects that come out of his mouth. He said he was going to balance the budget, why does he need to issue more debt ?
He’s going to jack up the national debt because he is going to extend his tax cuts. Totally fiscally irresponsible to do that, but that’s the way he’s been his entire life.
And his tariffs aren’t going to put a dent in the shortfall his extended tax cuts are going to cause. He has to cut medicare & medicaid to even just slow the bleeding. The Medicare “cut” will come from higher monthly premiums for everybody. The extended tax cuts benefit the wealthy the most, by far.
Just more fairy tales…American voters seem to luv fairy tales. But the majority of Americans are going to be paying more for goods and services, and paying more for health care. This doesn’t sound good for the stock markets.

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