Clarity and Uncertainty - March 2025
On Wednesday, March 18, the Federal Reserve (FED) held the Federal Funds interest rate steady at 4.25%-4.50% but adjusted the inputs used in its economic forecast. Higher tariff expectations led the FED to increase their PCE inflation forecasts by 0.3% to 2.8% for 2025 while at the same time downgrading their forecasts of GDP growth by 0.4% to 1.7% for the year. The FED continues to project two rate cuts in 2025 in their dot plot, but there remains much uncertainty around the timing of the expected cuts. Federal Reserve Chairman Jerome Powell made it clear that the Federal Open Market Committee (FOMC) is not in a hurry to cut rates and prefers to wait for further clarity on tariffs and other policies that may impact economic forecasts.
Just nine to twelve short months ago, interest rates were steadily climbing off the mat toward 3% and the path forward was on cruise control. The primary debate among informed market observers seemed to focus on whether 2019 would see three or four…
After sprinting to a 25% advance from the late December 2018 lows to a new high of 2945 on the S&P in early May, led again by the tech/growth complex, the market faded by ~5% in May. The culprit was a rapid escalation in trade tensions…
What a wild few months it’s been. Long gone are the calm, smooth waters of 2017. 2018 ended with a bang – or a crash! The dip in October as more rate hikes were foreshadowed was followed by a midterm election induced rally in November. Then the…
