Fed holds rates, says tariffs could cause stagflation

Ava Morgan
8 Min Read

Federal Reserve -chairman Jerome Powell speaks during a press conference after a federal open market committee meeting in the William McChesney Martin Jr. Federal Reserve Board building on May 7, 2025 in Washington, DC.

Andrew Harnik | Getty images

When the Federal Open Market Committee met in March, US President Donald Trump still had to unleash his so -called “mutual” rates around the world.

But fed polymakers were already bracing the impact of trade barriers. At the end of that meeting, the FOMC reduced its economic prediction for the US and increased its inflation project. Fed chairman Jerome Powell said that “a large part” from the downbeat prediction “comes from rates.”

On April 2, Trump even surprised the most passimistic market viewers when he held up the board with a list of higher than expected rates for many countries. Although Trump has pauted you since then, the Fed Sems would operate on the (vray uncertain) assumption that Trump could recover at any time.

During the most recent meeting of the FOMC that was closed on Wednesday, Powell no longer drew in his press conference after the meeting, as he did in March. This time I put the responsibility square on Trump’s rates and said that they are “probably” to cause hotter inflation, slower economic growth and higher unemployment – recipes for an internship scenario.

Until now, that is the cleraest warning from an American authority about the claims rates. However, consider that Trump not only pronounced frustrating about power, but also on Wednesday said he was not considering reducing the rate of 145% on China to start trading negotiations with the country, it is unlikely that Trump responded to the caution of the FED.

What to know today

The Fed has rates and warns of decline
The American Federal Reserve kept its main interest stable on Wednesday in a range between 4.25%-4.5%, where it has been since December. In his press conference -Appter the FED meeting, chairman Jerome Powell said that the “reciprocal” rates of Trump “were considerably larger than expected” and “probably start inflation, smooth economic growth and increased unemployment.”

Stock jumped buoy US indexes
US shares rose Wednesday. The S&P 500 0.43%added, the Dow Jones Industrial average Won 0.7%, stimulated by 10.8% jumped in it Disney Shares, and the Nasdaq Composite 0.27%climbed. Regional Europe Stoxx 600 Index fell by 0.54%. Retail shares fell 2.2% on the news that the turnover fell by 0.1% month after month in Bot The Euro Zone and the European Union in March, according to provisional data from Eurostat.

White House to simplify Chip exports
Nvidia Shares rose 3.1% as the Trump administration to protect what is known as the “AI diffuse rule”. The rule proposed by the BIDen administration, sorts countries into three different levels, all of which have different limitations to the question of whether advanced artificial intelligence chips such as those of Nvidia and Advanced micro devices Can be sent to the country without a permit.

AI could replace search engines: Apple
Alphabet Shares saw 7.5% and those of Apple According to Bloomberg, 1.1% after Eddy Cue, the Chef of Apple’s Services Chief, fell, that he believes that AI search engines will eventually replace standard uones such as Google. CUE said he was expectations for artificial intelligence services from OpenAI, Perplexity and Anthropic as search options in Apple’s safari browser in the future, according to the report.

Arm gives weak guidance
Shares of ARM Gave more than 11% in long-term trade after the chip design company had issued weaker than expected guidelines for the current quarter. Arm was planned that the profit per share will be between 30 cents and 38 cents, lower than the expectations of analysts of 42 cents. The middle assortment of the poor turnover forecast is also short of estimates, according to LSEG. Arm defeated the expectations for his tax fourth quarter.

[PRO] How to play trump’s ‘vray big announcement’
On Tuesday, during an Oval Office meeting with Canadian Prime Minister Mark Carney, Trump revealed that he is planning to make a “Vray, VY BIG announcement” prior to his trip to the middle -east next week. Here is something Jpmorgan Advises its customers on how to ride this potential wind wind for the market.

And finally …

Disney’s Minnie Mouse -Ballon is well read The 2024 Macy’s Thanksgiving Day Parade Balloon inflation on the eve of the Parade in New York, November 27, 2024.

Timothy A. Clary | AFP | Getty images

Disney announces a theme park and resort in Abu Dhabi

The Walt Disney Co. announces on Wednesday that you have reached an agreement with compelling legal and experiences Company Miraral to take refuge in Yas Island in the United Arab Emirates.

This will be the seventh theme carting of Disney and it will be fully developed and built by Miral. Disney’s imaginers will lead creative design and operational supervision of the project. The entertainment giant will not invest capital in the project, but will pick the benefits of royalties.

Disney, you have slowly entered the VAE in recent years, adding retailocations and Touring entertainment shows such as Broadways “The Lion King” and “Disney on Ice”. Disney notes that about a third of the world’s population lives within a four -hour flight of the VAE and that the region has a addressable tourist market of around 500 million visitors.