The US Federal Reserve’s Federal Open Market Committee (FOMC) announced on Wednesday that it will keep benchmark interest rates unchanged in the range of 4.25% to 4.5%. The decision comes amid continued pressure from President Donald Trump, who has publicly demanded rate cuts and lashed out at Fed Chair Jerome Powell.
In its policy statement, the Fed noted, “Although swings in net exports have affected the data, recent indicators suggest that economic activity has continued to expand at a solid pace. The unemployment rate remains low, and labor market conditions remain solid. Inflation remains somewhat elevated.”
Alongside the rate decision, the Fed revised its GDP growth estimate for 2025 down to 1.4%, from its earlier projection of 1.7%. The central bank's updated projections continue to signal a total of half a percentage point in rate cuts over the course of 2025 unchanged from its March predictions.
President Trump, who has increasingly broken with presidential precedent by directly criticising the independent central bank, escalated his attacks ahead of the FOMC decision.
In a video address, Trump referred to Powell as “stupid,” saying, “We have a stupid person at the Fed. He probably won’t cut today… Maybe I should go to the Fed. Am I allowed to appoint myself at the Fed?” He added, “I don’t even think he’s political. I think he hates me.”
Despite political pressure, the Fed maintained its cautious stance, stressed the need to monitor inflation trends and broader economic indicators before making further policy moves.
