Central bank keeps rates at 3.50–3.75%, citing solid economic growth and stabilising labour market despite calls from President Trump for lower borrowing costs
The US Federal Reserve held interest rates steady Wednesday at its first policy gathering this year, citing robust economic growth, as the central bank resists President Donald Trump’s mounting pressure for cuts.
The Fed’s 10-2 vote maintains rates at a range between 3.50 per cent and 3.75 per cent, an outcome that was widely expected as officials await more data on the world’s biggest economy.
In a statement on its decision, policymakers flagged that economic activity has been “expanding at a solid pace,” while the unemployment rate showed some “signs of stabilization.”
But the Federal Open Market Committee saw two dissents.
Fed Governor Stephen Miran, alongside Christopher Waller – who is seen as a potential candidate to succeed chairman Jerome Powell – both backed a quarter-percentage-point rate cut instead.
The Fed has made quarter-point cuts at its last three policy meetings as officials worried about the cooling jobs market. Miran, who was recently appointed by Trump, pushed for larger reductions each time.
But solid GDP growth, relatively low unemployment and stubborn inflation have provided reasons to pause, putting officials again at odds with Trump as he urged for lower interest rates.
Trump has sharply escalated pressure on the bank since returning to office one year ago, seeking to oust Fed Governor Lisa Cook while his administration launched a probe into Powell over the bank’s headquarters remodeling.
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