Federal Reserve policy enters 2025 wrestling with two key questions — how much further will the Fed cut rates and how will the central bank navigate a new fiscal environment given President Trump’s tax and tariff plans?

In December, the central bank signaled that 2025 would see half the number of rate cuts it had previously expected back in late summer — two 25 basis point moves instead of four.

A shift from the Powell Fed, in Barclays’ view, “would require evidence that convinces the committee that it is no longer on course to achieve its 2% inflation target over the medium term, which currently extends through 2027.”

Source: FINANCE.YAHOO