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The U.S. Federal Reserve has kept interest rates steady at a range of 3.50% to 3.75%, despite the lack of clear expectations regarding future policy directions. This decision led to an increase in long-term bond yields, especially the 30-year bonds, which reached their highest levels since 2007. The market lacks confidence in the central bank’s ability to reduce inflation to 2%. Additionally, this has caused stock prices and the dollar to decline, while the gap between short-term and long-term bond yields has widened. Investors remain concerned about persistent inflation and the possibility of rate hikes later if inflationary pressures continue. Experts believe that the unclear communication strategy increases market volatility and weakens investors’ ability to anticipate monetary policy movements, potentially raising funding costs and having negative effects on economic growth and financial markets throughout the rest of 2026.
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