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Updated 6 days ago on . Most recent reply

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Andrew Lokenauth
  • Investor
  • NYC
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Why Aren't Interest Rates Falling?

Andrew Lokenauth
  • Investor
  • NYC
Posted

Despite falling inflation, strong job growth, and public pressure to ease up, the Federal Reserve is keeping interest rates elevated. Why?

Because the risks of cutting too early are just too high. The threat of Trump’s tariffs driving prices back up is real. And the Fed’s job is to plan ahead—not react too fast.

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Jay Hinrichs
#1 All Forums Contributor
  • Lender
  • Lake Oswego OR Summerlin, NV
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Jay Hinrichs
#1 All Forums Contributor
  • Lender
  • Lake Oswego OR Summerlin, NV
Replied
Quote from @Lauren Robins:

The Federal Reserve is choosing to keep interest rates elevated despite falling inflation, strong job growth, and growing public pressure to begin cutting, because the risks of acting too soon outweigh the potential benefits. Cutting rates prematurely could reignite inflation, especially with factors like the threat of renewed tariffs—such as those proposed by former President Trump—looming on the horizon. Such tariffs could increase the cost of goods, pushing inflation back up just as it begins to cool.

The Fed’s mandate is to maintain long-term economic stability, which means making forward-looking decisions rather than responding reactively to short-term improvements. While the current economic data shows progress, the Fed remains cautious, aiming to ensure inflation is fully under control before easing monetary policy. In their view, maintaining higher rates a bit longer is a safer strategy than risking a resurgence of inflation that could require even more aggressive tightening down the line.



Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.


this must be chat GTP or whatever you call it   "former president Trump "  LOL should proof read your chat GP before you post it.
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JLH Capital Partners

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