Monetary policy

Federal Reserve Gov. Michelle Bowman, one of the central bank's more inflation-wary officials, said the balance of risks for monetary policymaking could soon shift.

Employers added 151,000 employees in February and the unemployment rate ticked up to 4.1%. The reading bolsters the Federal Reserve's argument to hold rates steady amid economic uncertainty.

A March 2025 survey by the National Association for Business Economics shows growing inflation concerns — and a diminishing chance of rate cuts — in 2025, but also optimism about avoiding a recession.

Notably, Trump described the January decision to hold rates steady – which looks set to be the Fed's stance for some time — as "the right thing to do."

The Federal Reserve's preferred inflation index showed little progress toward its target of 2%, increasing the likelihood of a prolonged rate pause.

Federal Reserve Vice Chair Philip Jefferson said clearer Fed communication and better text analysis has made monetary policy transmission more efficient, but noted that the central bank must remain diligent in how it communicates forward monetary policy guidance.

The Federal Reserve appears to be on hold, waiting for clarity on inflation and fiscal policy. The March 19th Federal Open Market Committee meeting, with a new Summary of Economic Projections will illuminate members' revised thoughts on interest rates. Join us March 20 at 12:00 pm as Mike Goosay, Chief Investment Officer of Global Fixed Income at Principal Asset Management, breaks down the meeting, Chair Powell's press conference and the SEP.

The Federal Reserve chair delivers his first semiannual monetary policy report of the 119th Congress, where he is expected to be asked about Fed independence and the economic impacts of Trump administration's policy choices.

Employers added fewer workers than anticipated last month, but upward revisions to previous estimates drove down the jobless rate. The report gives no clear directive to the Federal Reserve, which put rate cuts on hold last month.

As the Federal Reserve's overnight reverse repurchase agreement program nears zero, pressure could mount on the central bank to slow or stop its asset runoff as it fights inflation.