June 19, FOMC policy statement saw no changes to managed interest rates, as expected. Perhaps more interesting, however, was their Summary of Economic Projections, which continues to expect two rate cuts this year, but not by much, with nine participants (down from eight in the previous release) believing that no or one rate cut would be appropriate. They also expect inflation and unemployment to rise, while economic growth will slow. There were few changes to the statement, but it was interesting that they noted that "uncertainty about the economic outlook has decreased, but remains high" - this uncertainty is a controversial proposition, with continued uncertainty about trade policy, concerns about how the budget bill will affect government finances, and geopolitical turmoil. The vote was unanimous. The Summary of Economic Projections, while still believing that two rate cuts this year would be appropriate, now expects only one rate cut in 2026 (down from two) and only one rate cut in 2027 (no change, but sets the rate for that year at 3.4%, rather than 3.1% previously). The spread of points remains wide over the next few years and beyond.

Federal Reserve FOMC statement: Inflation remains slightly high.

Federal Reserve dot plot: The median expectation for the long-term federal funds rate is 3.0%.

Federal Reserve Dot Plot: The median forecast for the federal funds rate at the end of 2025 is 3.9% (3.9% in March).

The U.S. reserve balance interest rate as of June 19 was 4.4%, in line with expectations and the previous value of 4.40%.

June 19, financial website Fxstreet analyzed that the Federal Reserve is widely expected to keep its policy settings unchanged for the fourth consecutive meeting. Currently, the probability that the Federal Reserve will choose to cut interest rates for the first time this year in September is about 70%. Therefore, revisions in the dot plot and comments from Powell may provide key clues to the timing and number of rate cuts. If the revised economic forecast shows that policymakers still expect a total of 50 basis points of interest rate cuts this year, the US dollar may regain selling pressure in an immediate reaction. Downgrades to GDP growth and/or inflation expectations may exacerbate the selling of the US dollar. Conversely, if the dot plot highlights that officials now expect only one rate cut this year, the US dollar may strengthen. Investors currently expect the probability of the Federal Reserve cutting interest rates at least twice in 2025 to be about 70%. This market positioning suggests that the US dollar will have strong bullish potential in the event of a hawkish surprise.

Federal Housing Finance Agency Director Pulte: Powell should cut interest rates immediately or resign.

Fitch: We estimate that the Department of Government Efficiency (DOGE) will save approximately $150 billion per year through spending cuts.