The Fed just sent a message about the upcoming interest rate move.

Following the recent tariff measures by President Donald Trump, the Fed will be ready to intervene to reassure the financial markets. The tariff measures taken by U.S. President Donald Trump have caused significant fluctuations in the global financial markets over the past few days. In the context of a turbulent market, a senior official of the Federal Reserve (Fed) has spoken out to reassure that they will be ready to use tools to stabilize the financial markets if necessary. In an interview with the Financial Times, Ms. Susan Collins, President of the Boston Fed, emphasized that although “the market is still functioning well” and “we do not see concerns about liquidity,” the Fed is always ready to act when necessary. She asserted that the Fed currently has “additional permanent mechanisms that can support market functions” and is always ready to activate them. Ms. Collins reiterated that the central bank had successfully intervened during the Covid-19 phase when key financial markets froze due to a wave of global panic. The President of the Boston Fed also predicts that inflation this year will “far exceed” 3%. However, she notes that emergency interest rate cuts are not a priority solution to address the decline in market activity. Recently, Mr. Alberto Musalem, Chairman of the Fed St. Louis, stated that there is a need for “continuous vigilance” and “careful monitoring” of upcoming data. He mentioned that although he still expects the U.S. economy to grow at a moderate pace, the short-term risks are leaning towards higher inflation, slowing growth, and a weakening labor market. Meanwhile, Mr. John Williams, President of the New York Fed, provided a more specific forecast about the impact of Mr. Trump’s tax and immigration policies on the U.S. economy this year. “I forecast that the actual GDP growth of the U.S. will slow down significantly compared to last year, possibly falling below 1%. With this slow growth rate, I believe that the unemployment rate will increase from the current level of 4.2% to 4.5-5% next year,” he shared with the press. Mr. Williams also predicted that the increased tax levels would push inflation this year to 3.5-4%, significantly higher than the Fed’s long-term target. Currently, according to data from CME Group, investors are betting on about a 60% chance that the Fed will keep interest rates unchanged at 4.25-4.5% in the upcoming meeting. On April 4, President Trump called on Fed Chair Jerome Powell to cut interest rates. “Now is the perfect time for the Fed Chair to cut rates. He has always been slow, but now he can quickly change his image,” Trump wrote in a post on the social media platform Truth Social. However, the Fed chairman later noted that he would not rush to lower interest rates despite the financial markets falling into chaos. Mr. Powell said the Fed is waiting for things to become clearer before making any changes to monetary policy. He also mentioned that the retaliatory tariffs that Mr. Trump just announced are “much larger than expected.” The head of the U.S. Central Bank emphasized that inflation remains high, meaning that Fed officials will need to act cautiously as prices may temporarily rise due to tariffs.