At the May FOMC meeting, Jerome Powell and the Federal Reserve opted to maintain US interest rates for the third consecutive time, keeping the benchmark rate at 4.25% to 4.5%.
This decision was made during the two-day meeting held on May 6 and 7, despite President Donald Trump's requests for Chair Powell to reduce rates in light of declining inflation.
FOMC Meeting: US Federal Reserve Keeps Rates Unchanged
In a recent press release, the Federal Reserve announced its decision to keep the target range for the federal funds rate unchanged at 4.25% to 4.5%, aligning with market predictions.
Traders had anticipated that Jerome Powell and the committee would maintain steady rates during this May FOMC meeting.
This decision marks the third consecutive meeting where the Fed has opted to keep rates stable, following similar decisions in January and March.
Prior to this, the US Central Bank had implemented consecutive rate cuts in September, November, and December of 2024.
Jerome Powell and the FOMC remain resolute in their stance against rate cuts, despite repeated calls from President Donald Trump, who claims that the absence of inflation makes it an opportune moment for rate reductions.
Nevertheless, the Fed contends that inflation is still 'somewhat elevated' and that the uncertainty surrounding the economic outlook has intensified, likely exacerbated by Trump's tariffs, which Powell had previously cautioned about.
The US Central Bank also highlighted an increase in the risks of higher unemployment and inflation.
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