Federal Reserve officials are adopting a neutral policy stance while awaiting clearer direction from Donald Trump as his presidential term begins. Fed Governor Michelle W. Bowman indicated in a speech that the coming months should reveal the incoming administration’s policies and the persistence of inflationary pressures from 2024. Notably, both Bowman and Kansas City Federal Reserve President Jeff Schmid suggested that further rate cuts may not be required given the strong economic performance in late 2024, with inflation remaining above the 2% target. Philadelphia Fed President Patrick Harker mentioned the need for a pause in policy adjustments to assess the unfolding economic situation. The Fed also raised its inflation outlook for 2025 from 2.1% to 2.5%. Market analysts, noting the impact of strong US economic data on Bitcoin prices, suggest that tighter monetary policy could dampen cryptocurrency investments. Although the Fed had signaled only limited rate cuts ahead, the economic landscape remains uncertain.

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