There are major fears of a US stock market crash in the current year, and the US Federal Reserve may have a part to play in it after all, as per reports. There are increasing fears in the minds of US investors about the future of the US stock market in 2025 as the economic projections for the year 2025 by the Fed may have been incorrect after all, and Federal Reserve officials could do the unthinkable and pivot back to rate increases this year, says a Motley Fool report.

Could the US stock market crash because of the US Federal Reserve?

The US stock market has been banking on the hopes that the US Federal Reserve may keep issuing rate cuts in the year 2025, based on their last few economic projections, but it now looks like the golden days for US Investors my soon be over, once the Fed decides to increase interest rates, which could lead to a major dent in Wall Street stocks, feel market experts. There are chances of a stock market crash if this does happen.

Was the US economy misjudged by the US Federal Reserve?

As per reports, the US economy is stronger and inflation is stickier than the Federal Reserve anticipated, and therefore, the call for four rate cuts at the September meeting of 2024 may not see the green signal, and the Fed may stick to just two quarter-point cuts in 2025, which could set up a recipe for a US stock market crash.

In the case GDP increases faster than what was projected back in 2024, and unemployment rates remains lower and inflation trends higher, Fed officials may just have to take the harsh call to pivot back to rate increases in 2025.

FAQs:

Has the US stock market crashed?
No, the US stock market has not crashed in recent while, and has instead been on a major bull run for a major part of two years now.

What are some of the top US stocks?
The top US stocks stocks include the likes of Nvidia, Apple, Alphabet, Amazon, Meta Platforms and many more.