The US market closed Wednesday with little change after the US Federal Reserve maintained interest rates.
Jerome Powell, the chair of the central bank, indicated a cautious approach by choosing to keep its benchmark rate unchanged.
Powell said that before considering any further rate changes, the Fed will assess the impact President Donald Trump’s tariffs implemented recently on inflation.
S&P500 was down by 0.03% at 5,980.86. Dow Jones dropped 44 points, to 42 171.66. The Nasdaq, which is dominated by tech stocks, closed up 0.13% at 19,546.27.
Coinbase, Wells Fargo and Intel were the three top performers in the S&P 500 index on Wednesday.
Marvell Technology Inc. ranked as the top Nasdaq gainer.
Coinbase and USDC-issuer Circle both gained 17% during the session after the US Senate approved the landmark GENIUS Act. This will create a framework that allows private entities to release stablecoins.
Intel has gained after adding new members to its leadership team, which includes the Engineering division.
This struggling company is looking to turn around its AI chips to be able to compete with market leader Nvidia.
Marvell’s stock rose 7% following an announcement that it would be collaborating with Empower Semiconductor to develop integrated power solutions on its custom silicon platform.
Mastercard and Visa are among the worst performers in the S&P 500.
The GENIUS Act has given corporations that plan to release stablecoins a boost.
Amazon and Walmart are reportedly planning to launch their own stablecoins.
Federal Reserve keeps rates the same amid concerns about tariffs
The Fed kept its key rate unchanged on Wednesday within the target range between 4.25% and 4.5%. This is the same level as it’s been since December.
Investors were given a mixed picture by the central bank update.
The policymakers are still anticipating possible rate cuts in the second half of this year but they have also warned about stagflation.
According to the projections of policymakers, two additional quarter-point rates reductions are expected for this year.
They revised the economic forecast down to 1.4% in 2025 and increased their outlook on core inflation from 3.1% to 3.1%.
Powell admitted that the tariffs had “begun to have some effect” on inflation during a subsequent press conference.
He said that despite this the policymakers were “well-positioned” to wait before making any interest rate changes.
On Wednesday morning, Donald Trump again criticised Powell and the other Federal Reserve officials over their unwillingness to relax monetary policy.
Powell was reportedly called “stupid”, because he did not support a rate-cutting committee.
Federal Reserve officials are reportedly hesitant to make rate adjustments, as they fear that tariffs imposed by President Trump in this year will lead to an increase of inflation over the next few months.
Up to this point, different price indicators do not show a major impact of these duties.
Together, the delayed impact of tariffs and a softer consumer demand, as well as an accumulation of inventory prior to the “liberation” day announcement on April 2, have all contributed to reducing their overall effect.
The post US Markets Close Flat as Fed Keeps Interest Rates the Same, Dow Jones in Red may be updated as new developments unfold.
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