Chair of the U.S. Federal Reserve Jerome Powell addressed the House Financial Services Committee. His speech came amid intensified criticism from President Donald Trump and discussions within the Fed’s Board of Governors regarding future monetary policy.
This is reported by Finway
Powell Did Not Announce Rate Cut Despite Pressure
During the hearings, Jerome Powell refrained from announcing a potential rate cut in July, although some of his colleagues and market analysts anticipated such a move. He reiterated his key points made earlier at the press conference following the Fed’s meeting on June 18, emphasizing that it is too early to discuss a change in monetary policy direction.
“At this point, we have every reason to wait and learn more about the likely course of the economy before considering any adjustments to our policy stance,” he stressed.
At the same time, Powell noted that it is currently difficult to assess the real impact of the Trump administration’s tariff policy on the U.S. economy — it will all depend on the final scope of these measures.
Discussions at the Fed and Market Reactions
Powell’s cautious stance contrasts with statements from some members of the Fed’s Board of Governors. For instance, Fed Vice Chair Michelle Bowman emphasized at a conference in Prague that she could support a rate cut as early as July 2025 if inflation remains at moderate levels. Her colleague Christopher Waller expressed a similar view, not ruling out a policy easing in the near future.
In this context, financial markets reacted by increasing the likelihood of a rate cut: according to CME Global, this figure rose to 16.5%.
It is worth noting that criticism from Donald Trump continues unabated. Ahead of Powell’s speech, the president posted the following statement on the social media platform Truth Social:
“[…] I hope Congress can deal with this foolish and stubborn man. His incompetence will cost us dearly.”
The next Fed meeting regarding interest rates is scheduled for July 29-30, 2025. By that date, a new report on the Consumer Price Index (CPI) and unemployment rate is expected, which could influence the regulator’s decision. Additionally, Powell is set to speak before the Congressional Banking Committee in the coming days, where further explanations regarding Fed policy are likely to be provided.