Fed signals cautious stance amid economic uncertainty
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Federal Reserve officials agreed on the need for a cautious approach due to heightened economic uncertainty, according to the minutes from the May 6–7 meeting. While the U.S. economy and labor market remain strong, the Fed noted that current monetary policy is "moderately restrictive" and the central bank is "well positioned to wait for greater clarity" on inflation and economic outlook.
The board highlighted increased risks to both inflation and unemployment compared to the March meeting, largely due to the potential impact of tariffs. Such risks could challenge the Fed’s dual mandate of price stability and maximum employment.
Officials reiterated their intention to keep interest rates steady for the time being, citing unclear effects from recent policy changes in Washington. At the May meeting, the Fed left its benchmark rate unchanged in the 4.25%–4.5% range for the third consecutive time.
Trade tensions, particularly the unpredictable policies of President Donald Trump, remain a key source of uncertainty. The meeting occurred just days before the U.S. and China announced a temporary agreement to ease tariffs on each other’s goods
The board highlighted increased risks to both inflation and unemployment compared to the March meeting, largely due to the potential impact of tariffs. Such risks could challenge the Fed’s dual mandate of price stability and maximum employment.
Officials reiterated their intention to keep interest rates steady for the time being, citing unclear effects from recent policy changes in Washington. At the May meeting, the Fed left its benchmark rate unchanged in the 4.25%–4.5% range for the third consecutive time.
Trade tensions, particularly the unpredictable policies of President Donald Trump, remain a key source of uncertainty. The meeting occurred just days before the U.S. and China announced a temporary agreement to ease tariffs on each other’s goods