Fed focused stock ETFs hold stable rates

The Federal Reserve did not move to Wednesday without changing interest rates. That’s where the federal government rate was The final cut In December.

The decision was widely expected. SPDR S&P 500 ETF Trust (SPY) The last trade of the day was higher than fractions and hovered near the same level as before the rate announcement.

In addition to determining its fees, the US Central Bank has released an updated overview of its economic forecasts. Fed officials currently forecast GDP growth of 1.4% in 2025 and 1.6% in 2026, down from previous estimates of 1.7% and 1.8%. At the same time, they are seeing PCE inflation enter at 3% this year and 2.4% next year.

At a post-meeting press conference, Fed Chairman Jerome Powell said it generally sounds bright to the economy and remains on a relatively solid footing, but he admitted there may be modest cooling in the labour market. He emphasized that future fee routes are very uncertain, saying that most Fed officials are holding them steady, unless the data is significantly changed.

The median forecast shows two same interest rate cuts as in March this year. However, there is a growing division among policymakers, with some expecting no reductions at all.

“No one holds these rate passes with great confidence,” Powell said.

Powell didn’t make it very clear, but tariffs were once again an important point of discussion. “The US has not implemented tariff increases of this magnitude in decades, so there is little related empirical evidence of its effectiveness,” he said.

Powell added that he hopes the Fed will “learn more over the summer with tariffs,” and that he has admitted that someone has to pay, whether it’s a consumer, a business or a foreign exporter.

The potential inflation impact of tariffs appears to lie on the Fed radar, which may help explain why policymakers are not rushing to cut fees despite inflation being cooled in recent months.

Market volumes were seen little in the Fed’s decisions and forecasts that investors came as surprise ahead of the June holiday when the US market was shut down.

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