What Changes Will Be Announced Next Week Regarding the Fed's Interest Rate Decision?

According to Yardeni Research, the Fed is expected to stay tuned on interest rates at the Federal Open Market Committee (FOMC) meeting on July 30. According to research data, the possibility of interest rate cuts remains at 4.7%. Although the positive employment data released in June has delayed expectations for short-term interest rate cuts, the moderate inflation report expected in September is likely to reinforce signals regarding the potential for interest rate reductions. While the market is growing with better-than-expected Q2 earnings data being released, there are opinions that if the Fed delivers a dovish message next week, the stock market may gain new momentum. Meanwhile, although Fed Chairman Jerome Powell is said to be under increasing pressure from the White House to lower interest rates, market experts and economists do not expect the central bank to take a dovish move in the short term. One of the most important reasons for this is that Powell cannot make decisions on his own at the Federal Open Market Committee (FOMC), the agency that sets monetary policy. He is just one member of a 12-member board. Furthermore, the Fed has a dual mandate: to control inflation while ensuring maximum employment. The current strong labor market does not create an environment that necessitates interest rate cuts. Moreover, any new tariffs that may be imposed in the near future could increase inflation. The Federal Reserve has kept the federal funds target rate unchanged at 4.25% to 4.50% since December. This bank also held the interest rate steady at the June meeting, making the decision based on the rigidity of inflation, the impact of trade tariffs, and the need for more data.