2 more rate cuts in 2025 a probability, says Fed’s Jerome Powell

Federal Reserve Chair Jerome Powell said on Wednesday that while a slim majority of Fed officials foresee at least two more rate cuts this year, such moves remain conditional on data and evolving risks. “We are not on a preset path,” he emphasized.

He also said the risk of persistent inflation has eased in recent months, citing a softer labor market and slower GDP growth.

While acknowledging tariffs are adding to price pressures, he noted they appear more like a “one-time price increase” rather than the start of an inflationary cycle.

“Really, since April, to me, the risks of higher and more persistent inflation have probably become a little less, and that’s partly because the labor market has softened, GDP growth has slowed,” Powell said a press conference following the latest Federal Open Market Committee meeting.

Tariff impact on consumers has been small so far: Powell

Powell said the pass through of tariffs to higher prices for consumers has so far been small, and the cost is largely being absorbed by companies sitting in the middle of supply chains.
“It’s very clear that there’s some pass through,” Powell said at a press conference following the central bank’s latest policy meeting. Companies involved in trade will “tell you that they have every intention of passing through in time, but they’re not doing that now.”