The Federal Reserve maintains the current interest rate unchanged

The minutes of the last FOMC meeting presided over by Powell were released. The Federal Reserve maintained the interest rate at 3.5%-3.75% with 8 votes in favor and 4 votes against. The minutes showed that compared to the previous meeting statement, the internal views of the Federal Reserve were significantly more hawkish, with most officials favoring the removal of the easing language.
In terms of inflation, besides traditional factors such as crude oil and shipping, the rise in software prices is a significant factor driving up core inflation, becoming a key driver of inflation. Meanwhile, concerns have been raised about risks in the private credit market. In the first quarter of 2026, there was a net outflow of funds from some credit instruments. The expectation of AI disrupting various industries has exacerbated credit anxiety, especially for the software industry. Furthermore, due to the lack of transparency in the credit market, Federal Reserve officials are concerned about the potential transmission and spread of risks.
Looking ahead, it is highly likely that interest rates will remain unchanged in June with the removal of easing language. There is almost no possibility of interest rate cuts in 2026, and continued strong inflation may trigger interest rate hikes. In terms of trading, it is necessary to reduce positions to control risks in US stocks, but technology remains the main focus. Moving forward, the key focus should be on inflation, employment data, and guidance from technology companies.

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