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Below the Quote on Fed meeting from Mr. Ashwani Dhanawat, Executive Director & Chief Investment Officer, Shriram General Insurance 

“The Federal Reserve has made notable adjustments to its 2025 economic forecasts, lowering the GDP growth projection from 2.1% to 1.7%, while also raising the unemployment forecast to 4.4% from 4.3%. Additionally, the forecasts for both overall PCE inflation and core PCE inflation have been increased to 2.7% and 2.8%, respectively, up from 2.5%. These weakened macro projections suggest a more cautious economic outlook, which could influence monetary policy decisions moving forward.

 The market is reacting, with futures indicating a 62.1% probability that the Fed will resume rate cuts in the upcoming June meeting, reflecting a slight increase from the previous 57%. This shift signals trader sentiment that the Fed may need to take more accommodative steps to support the economy amid lower growth expectations and rising inflation concerns. The implications of these developments could lead to increased volatility in financial markets as investors recalibrate their strategies in response to the Fed’s evolving outlook.”

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