"Fed Messenger": Why the Fed is not in a hurry to join the ranks of central banks that cut interest rates

On May 8th, Nick Timiraos, the "Federal Reserve mouthpiece", said that Powell played down any speculation that the Federal Reserve is seeking to ease the economic weakness caused by Trump's tariffs by cutting interest rates. < b > Powell mentioned the word "wait" 22 times during the press conference to emphasize that the Federal Reserve is not in a hurry to act. The remarks exposed the monetary policy divide between the United States and other economies caused by Trump's trade policy. The reason is simple. Other economies have not raised taxes significantly on imported goods. The problem is weaker demand and employment. < b > But without the impact of rising prices that the Federal Reserve may have to deal with later this year. Moreover, since the US economy has just gone through a period of high inflation, the Fed has decided that it cannot risk a pre-emptive rate cut to support a slowdown in employment, lest it exacerbate price pressures in the short term. As a result, the Fed's stance is different from that of the central banks of Europe, Canada and the UK. < b > Powell suggested that the Fed will only cut interest rates if it sees evidence of a significant slowdown in economic growth, and possibly quickly.