Reuters survey indicates Fed likely to maintain current rates at January session

Fed Expected to Hold Interest Rates Steady in January

A recent Reuters survey indicates that every economist polled anticipates the Federal Reserve will leave its benchmark interest rate unchanged at its upcoming January meeting.

All 100 experts surveyed predict the federal funds rate will remain within the 3.50% to 3.75% range during the January 27-28 gathering. Notably, 58% of those polled do not foresee any rate adjustments in the first quarter—a shift from December’s survey, where at least one rate cut by March was expected.

The poll suggests that robust economic growth and inflation rates still exceeding the Fed’s 2% goal are likely to delay any immediate rate reductions. Nevertheless, a majority of economists still anticipate at least two rate cuts before the end of the year.

Looking beyond the first quarter, opinions diverge. While uncertainty persists, a slim majority—55 out of 100 economists—believe that rate cuts will resume in June or later, after Jerome Powell’s term as Fed Chair concludes in May.

The survey also points to a slightly improved economic outlook for the United States, which may support the Fed’s patient approach. Economists now project US GDP growth of 2.2% in 2025, followed by 2.3% in 2026 and 2.0% in 2027. These figures are marginally higher than those in December’s poll, which forecasted growth of 2.0%, 1.9%, and 2.0% for those years, respectively.

Market Response

The US Dollar Index (DXY), which measures the dollar’s strength against six major currencies, is currently hovering near 98.48—its lowest level in two weeks—and has declined for three consecutive days.