Things you need to know before the Fed interest rate decision

The Fed, which has kept interest rates steady and has not gone for a rebate since January, is expected to maintain this stance this evening. Markets are also reflecting this expectation at a rate of 98%.

Inflation uncertainty…

Since last year, inflation, which has turned downward, had risen again to 3% with a 50 basis point cut in interest rates in September 2024. Subsequently, the US CPI, which fell again, had increased along with the "tariff wars" and was reported as 2.7% in June.

Fed Chairman Powell also stated that they are reluctant to cut interest rates due to the pressure and uncertainty that tariffs create on inflation.

There is no unity within the Fed

The U.S. media is reporting that there is no consensus within the Fed regarding interest rate rebates. According to CNBC, Christopher Waller and Michelle Bowman stated that rates should be lowered as soon as possible, while some Fed members believe that there should be no rebates throughout the entirety of 2025.

In the dot-plot graphs announced in June, the average number of rebates for 2025 was seen as "2." However, there will be no dot plots in today's Fed meeting.

One of the members indicated as a possible successor to Powell as the Fed chair, Christopher Waller, stated in a statement made a few weeks ago that July would be suitable for a rate rebate.

Tension in the Fed building...

Some of the questions that journalists will ask at the press conference to be held at 21:30 Turkish time this evening will also be related to the budget set for the restoration of the Fed building. It has been claimed that this issue, which has been occupying the American public for some time, could even remove Powell from his position.

Last week, Donald Trump observed the work on-site and visited the Fed's building in Washington. While the tense postures of the duo drew attention here, Trump added the cost of a building completed 5 years ago to the announced amount, while Powell firmly objected.

Trump's words, "All I want from him is to lower the interest rates..." had also softened the atmosphere, and he had distanced himself from the press members.

Prices and rates are fixed...

Before the interest rate decision, the silence in the markets before the storm is noteworthy. The price of Bitcoin is hovering around 118 thousand dollars and volatility has significantly decreased in recent days.

U.S. Treasury bonds have also remained relatively unchanged. Bond yields are important as they reflect the market's expectations for future interest rates and inflation forecasts.

Published: July 30, 2025 13:18Last Updated: July 30, 2025 13:26