JP Morgan’s Jahangir Aziz believes the US Federal Reserve’s June policy decision left markets with little to work with. The central bank held interest rates steady and made only minor tweaks to its economic projections, sticking with a cautious tone that didn’t offer clear direction on what lies ahead.Aziz said the rate hold was already priced in by the market, and the updated Summary of Economic Projections (SEP) broadly followed expectations—lower growth, higher inflation, and a slight rise in unemployment. What stood out was the Fed sticking with its forecast of two rate cuts this year, while removing one from its 2026 outlook.
Even so, he doesn’t think these adjustments signal a shift in stance. “Apart from these minor differences, I don’t think there was much of a surprise of any kind in the press statement, the press conference, or in the FOMC statement by itself,” he said in an interview with CNBC-TV18.
Aziz pointed out that both the Fed and the market remain in a holding pattern, reacting to data as it comes. That leaves investors without a strong signal on when rate cuts will actually begin or how long rates might stay elevated.Beyond the Fed, Aziz warned that the bigger risks to the US economy could come from elsewhere—particularly the uncertainty around tariffs. With legal challenges to tariff provisions still pending and the possibility of new trade actions later in the year, he said markets may be underplaying the potential impact.
Even so, he doesn’t think these adjustments signal a shift in stance. “Apart from these minor differences, I don’t think there was much of a surprise of any kind in the press statement, the press conference, or in the FOMC statement by itself,” he said in an interview with CNBC-TV18.
Aziz pointed out that both the Fed and the market remain in a holding pattern, reacting to data as it comes. That leaves investors without a strong signal on when rate cuts will actually begin or how long rates might stay elevated.Beyond the Fed, Aziz warned that the bigger risks to the US economy could come from elsewhere—particularly the uncertainty around tariffs. With legal challenges to tariff provisions still pending and the possibility of new trade actions later in the year, he said markets may be underplaying the potential impact.
While recession is no longer JPMorgan’s base case for 2025, Aziz said that could change if tariff disruptions return. For now, though, the Fed appears content to wait, watch, and signal little.
