Financial Market Research Brief

Fed pauses on rate adjustments to start the year. After three consecutive cuts, the Federal Open Market Committee opted to hold the overnight lending rate steady at a lower bound of 3.5 percent in its first meeting of 2026. While the FOMC viewed the current rate as supporting its mandate to achieve price stability and maximum employment, committee members remain open to future adjustments as warranted by incoming data. Chief among inflation concerns are the ongoing effects of tariffs, while the labor market has shown both signs of weakness and stability in recent months