Federal Reserve Vice Chair and Vice President: Interest rates may not be lowered before September.

Top officials, including Federal Reserve Vice Chairman Jefferson and New York Fed President Williams, suggest that due to uncertain economic prospects, policymakers may not be ready to lower interest rates before September. Federal Reserve "number three" Williams said on Monday, "We won't be able to figure out what happened in June or July. It will be a process of collecting data, gaining a clearer understanding of the situation, and observing how events unfold." The next three meetings of the Federal Reserve will take place in June, July, and September respectively. Investors currently estimate that the probability of a rate cut during the next meeting on June 17-18 is less than 10%. According to federal funds futures pricing, investors expect the Fed to cut rates twice by the end of the year, each time by 25 basis points, which is lower than the expected four rate cuts at the end of April. Atlanta Fed President Bostic also expressed similar views on Monday, suggesting an unwillingness to adjust interest rates for a period of time. Bostic stated that if the trade negotiations being conducted by the Trump administration drag on, "this will continue into the summer, in which case, we may actually have to wait a few more months to know what the real impact is." Earlier on Monday, Bostic pointed out that policymakers need to wait "three to six months" to see how events unfold. He stated that trade negotiations could progress faster than expected, and tariff reductions could exceed expectations. He said, "In this case, we might take some action earlier, because there may not be as much to do in terms of managing price levels." Williams continued to emphasize that uncertainty not only hinders policymakers, but also businesses and households, as they struggle to predict how the Trump administration's tariffs and other policies will reshape the U.S. economy. Federal Reserve officials kept rates unchanged in early May, citing increased uncertainty from tariffs. Policymakers also saw risks of rising unemployment and inflation. The Trump administration recently reached a temporary agreement with China to lower tariffs on various imported goods. Currently, negotiations with major trading partners are ongoing, with the 90-day suspension of matching tariffs halfway through. Williams, like many of his colleagues, stated that the Fed can slowly evaluate new data. While he acknowledged that inflation has been falling, and the economy is nearing full employment, he is still closely monitoring default rates and consumer spending intentions. He also described the current policy environment of the Fed as "slightly restrictive" and in good shape. Bostic specifically expressed concern about inflation and public expectations for future price increases. Bostic said: "Considering the trajectory and responsibilities of our two tasks, I am very concerned about inflation, mainly because we see expectations changing in a troubling way." Federal Reserve "number two" Vice Chairman Jefferson also emphasized a wait-and-see attitude on Monday. He stated that the Fed must ensure that any potential price increases do not evolve into sustained inflation. Jefferson said, "Given the level of uncertainty we are facing, I believe we should wait and see how policies will evolve and their impact." He added that monetary policy is in a "very good position." Minneapolis Fed President Kashkari also gave a speech on Monday, noting that the U.S. economy was strong at the beginning of the year, and the Fed has made significant progress in reducing inflation. However, he noted that tariffs have thrown a "curveball" at policymakers, and currently they can only wait and gather more information. Kashkari said, "We are grappling with a lot of uncertainty. We can only wait until we have more information."