#PowellRemarks

WASHINGTON (AP) — Federal Reserve officials expect inflation to worsen in the coming months but they still foresee two interest rate cuts by the end of this year, the same as they projected in March.

Watch Federal Reserve Chair Jerome Powell's remarks in the player above.

The Fed kept its key rate unchanged for the fourth straight meeting Wednesday, and said the economy is expanding at "a solid pace." Changes to the Fed's rate typically — though not always — influence borrowing costs for mortgages, auto loans, credit cards, and business loans.

WATCH: Powell delivers remarks as Trump pushes budget that could add $5.1 trillion in debt

The central bank also released its latest quarterly projections for the economy and interest rates. It expects noticeably weaker growth, higher inflation, and slightly higher unemployment by the end of this year than it had forecast in March, before President Donald Trump announced sweeping tariffs April 2. Most of those duties were then postponed April 9. The Fed also signaled it would cut rates just once in 2026, down from two cuts projected