JPMorgan updates Fed interest rate cut outlook
When will the Fed cut rates?
President Donald Trump has repeatedly expressed frustration with Federal Reserve Chair Jerome Powell, at times even suggesting he should be removed from his post.
And most recently, the director of the Federal Housing Finance Agency joined the chorus, urging the Fed to resume rate cuts.
But despite growing political pressure, don’t expect Powell or the central bank to act anytime soon, said J.P. Morgan Chief Global Strategist David Kelly.
Speaking this week at FPA NorCal’s 53rd annual conference, Kelly underscored a key point: the Fed’s priority remains squarely focused on inflation – not politics. Image source: Getty Images
Fed independence and the inflation mandate
The Fed operates under a dual mandate from Congress: to promote maximum employment and maintain price stability, generally interpreted as 2% inflation. This framework is designed to insulate monetary policy from political interference, ensuring decisions are based on economic data rather than partisan demands.
