Federal Reserve Holds Interest Rates Steady as Economic Uncertainty Grows

The Fed downgrades economic forecasts and resists political pressure for rate cuts, citing impacts of Trump's trade policies.

The Federal Reserve has kept interest rates unchanged, maintaining a range of 4.25% to 4.50%, as uncertainty in the U.S. economy increases.
Revised projections from the Fed anticipate slower GDP growth at 1.7%, higher inflation at 2.7%, and a slight rise in unemployment to 4.4% by the end of 2025.
Fed Chair Jerome Powell emphasized patience and the need for clarity before making further monetary policy adjustments, despite calls from President Trump for immediate rate cuts.
The Fed plans two 0.25% rate cuts later in the year, depending on how the economic effects of Trump's tariffs and spending cuts unfold.
Economic analysts warn of potential recession risks driven by rising inflation, slower growth, and increased unemployment under the current trade and fiscal policies.