Monetary Policy Insights - The Federal Reserve maintained the federal funds rate target range at 4.25%-4.50%, aligning with market expectations[5] - The pace of balance sheet reduction (QT Taper) will slow from $25 billion to $5 billion per month starting April 1, while MBS reduction remains at $35 billion per month[5] - The median GDP growth forecast for 2025 was downgraded from 2.1% to 1.7%, and the unemployment rate forecast was adjusted from 4.3% to 4.4%[5] Inflation and Economic Outlook - The PCE inflation forecast for 2025 was revised up from 2.5% to 2.7%, with core PCE inflation rising from 2.5% to 2.8% due to tariff impacts[5] - The Fed's approach has shifted from preemptive rate cuts to a data-dependent strategy, indicating potential delays in response to economic downturns[11] - Current economic indicators, such as a stable unemployment rate at 4.1%, suggest that the economy remains in reasonable condition despite inflation concerns[10] Global Economic Context - The U.S. liquidity situation is tight, with the Fed's total assets reduced to $6.7 trillion, returning to pre-pandemic levels[7] - China's economic challenges are characterized by deflation rather than inflation, with net exports contributing 30% to GDP in 2024, the highest since the 2008 financial crisis[12] - The need for proactive monetary policy adjustments in China is emphasized, particularly in light of potential U.S. economic downturns and tariff impacts[13]