No one knows quite what to expect from the Federal Reserve in 2025, least of all officials at the Fed itself.

After cutting interest rates three times in as many meetings, the Fed is entering a new♏ phase in its fight against inflation as it goes into 2025. The Fed is 澳洲幸运5官方开奖结果体彩网:waiting to see what wi🐓ll happen with inflation, whether incoming President Donald Trump will impose heavy tariffs, and what effect𒊎 those tariffs will have on the economy. That's not to mention changes to tax policy, regulations, and many other factors that might change as the government switches over to Republican control in January.

Chair Jerome Powell used the words "uncertain" or "uncertainty" 14 times during a press conference following the Fed's most recent policy announcement in December.

"The uncertainty is just a function of the fact that we expect significant policy changes," he said. "There's nothing really unusual about that. I think we need to see what they are and see what the effects they will have."

Inflation Remains Stubborn and Trump Proposals Likely Won't Help

At least one thing is still certain: inflation remains above the Federal Reserve's annual goal of 2%, rising by 澳洲幸运5官方开奖结果体彩网:2.4% by ♌the Fed's preferred measure. Next year, the Fed will try to bring that down while preventing a severeꦜ unemployment ris🍒e.

Accomplishing both of those goals is a balancing act because the Fed's main tool is manipulating the 澳洲幸运5官方开奖结果体彩网:federal funds rate, which influences borrowing costs on all kinds of loans. A higher fed funds rate can slow the economy and reduce inflation but it could also damage the job market.

The Fed lowered the fed funds rate from a two-decade high in September and, over the course of three meetings, reduced it by an entire percentage point. Central bankers expect more cuts next year but at a much slower pace. According to Fed officials' latest round of economic projections, they anticipate lowering their benchmark rate by just three-quarters of a percentage point all year.

Of all the potential changes brought by the new presidential administration, the Fed has paid special attention to tariffs. Trump said he would impose high import taxes on U.S. trading partners, but the 澳洲幸运5官方开奖结果体彩网:details of the plan are unclear.

Economists said tariffs could stoke inflation as merchants pass costs along to their customers. It could also slow the economy and reduce employment, complicating the Fed's goal of stabilizing both price increases and unemployment.

Trump Vs. Powell, Round 2?

The new year may also bring a political clash betwee🃏n the Fed and the White House.

Trump frequently criticized Powell during his first presidency, attacking him for keeping interest rates higher than Trump would like. Although Trump has said he would 澳洲幸运5官方开奖结果体彩网:not try to fire Powell&nbs༺p;before his term ends in 2026, he has said he would like to have more influence over the central bank's policy decisions.

Powell has 澳洲幸运5官方开奖结果体彩网:pushed back against that idea, maintaining that the Fed is more effective the farther removed it is from direct control by politicians.