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Fed Holds Rates Steady, Foreseeing Inflation, Tight Labor Markets

Jun 18, 2025

McLean, Va. (June 18, 2025) — The Federal Reserve held the federal funds rate steady at a target range of 4.25% to 4.5% for the fourth meeting in a row. In its announcement, Fed Chair Jerome Powell cited the need to keep policy rates modestly restrictive to address a meaningful amount of inflation projected over the coming months.

The median forecast for 2025 GDP growth from members of the Federal Open Market Committee was downgraded again this quarter to 1.4%, below the committee’s estimate of the long-term trend released in March. Forecasts for unemployment expanded slightly to 4.5%, and projections for inflation reached 3% through 2025.

“With the Federal Reserve acknowledging that the economy is very near mainstream estimates of maximum employment, the deployment of additional capital resources, including automation, will be necessary for the economy to grow meaningfully while keeping inflation expectations well anchored,” said Christopher Chidzik, principal economist of AMT – The Association For Manufacturing Technology. “Further tightness in the labor markets could be the catalyst for additional investment in manufacturing technology, where orders are already up nearly 18% through April 2025.”

Registration is now open for the annual MTForecast conference, the manufacturing technology industry’s must-attend event for economic forecasts, market data analysis, and customer industry outlooks. MTForecast 2025 will be held Oct. 15-17 in Schaumburg, Illinois.

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Members of AMT – The Association For Manufacturing Technology build and sell metalworking machinery, commonly known as machine tools, as well as the workholding, tooling, inspection equipment, and automation integral to modern manufacturing.

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Kristin Bartschi
Director, Marketing & Communications
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New bills, new policies, and new possibilities – get your bearings at MTForecast on Oct. 15-17! Top economists and industry experts will cut through the noise and deliver focused insights on the key drivers shaping manufacturing markets into 2026.
In the midst of the recession caused by the 2008 financial crisis, orders for metalworking machinery totaled around $95 million in Jan. 2009, the lowest level recorded. Although orders grew scarcer, businesses continued to invest in manufacturing tech.
Today, the Federal Reserve held the federal funds rate steady at a target range of 4.25% to 4.5% for the third meeting in a row, citing increasing uncertainty in the economic outlook and a rising risk of higher unemployment and inflation.
Today, the U.S. Bureau of Economic Analysis released their first estimate of GDP for the first quarter of 2025. According to the estimate, GDP contracted 0.3% at an annualized rate.
For the second meeting in a row, the Federal Reserve announced it will hold federal fund rates steady at a target range of 4.25% to 4.5%. Learn what this means for the producers and distributors of manufacturing technology.
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