Subscribe to Here’s the Deal, our politics newsletter for analysis you won’t find anywhere else.
Thank you. Please check your inbox to confirm.
Christopher Rugaber, Associated Press Christopher Rugaber, Associated Press
Leave your feedback
WASHINGTON (AP) — The Federal Reserve kept its benchmark interest rate unchanged Wednesday and signaled that it still expects to cut rates twice this year, though more policymakers forecast fewer cuts.
Powell is scheduled to speak at 2:30 p.m. ET. Watch in the player above.
The Fed also now expects the economy to grow more slowly this year and next than it did three months ago, according to a set of quarterly economic projections also released Wednesday. It also expects the unemployment rate to tick higher, to 4.4%.
Policymakers also expect inflation will pick up slightly by the end of this year, to 2.7% from its current level of 2.5%. Bother are above the central bank’s 2% target.
“Uncertainty around the economic outlook has increased,” the Fed said in a statement released after its two-day meeting.
The projections underscore the tight spot the Fed may find itself in this year: Higher inflation typically would lead the Fed to keep its key rate elevated, or even raise rates. On the other hand, slower growth and higher unemployment would often cause the Fed to cut rates to spur more borrowing and spending and lift the economy.
It is the second meeting in a row that the Fed has kept its interest rate at about 4.3% as the central bank has moved to the sidelines as it evaluates the impact of the Trump administration’s policies on the economy. Economists forecast that tariffs will likely push up inflation, at least temporarily. But other policies, such as deregulation, could lower costs and cool inflation.
By Hanna Arhirova, Associated Press
By Alex Veiga, Mae Anderson, Associated Press
By Matthew Lee, Associated Press
Christopher Rugaber, Associated Press Christopher Rugaber, Associated Press
Support Provided By: Learn more
Support PBS News:
Subscribe to Here’s the Deal, our politics newsletter for analysis you won’t find anywhere else.
Thank you. Please check your inbox to confirm.
© 1996 – 2025 NewsHour Productions LLC. All Rights Reserved.
PBS is a 501(c)(3) not-for-profit organization.
Sections
About
Stay Connected
Subscribe to Here’s the Deal with Lisa Desjardins
Thank you. Please check your inbox to confirm.
Learn more about Friends of the News Hour.
Support for News Hour Provided By
