❓WHAT HAPPENED: The Federal Reserve’s Federal Open Market Committee is expected to keep interest rates at their current levels when the central bank’s leadership meets on Wednesday, despite continued indicators that inflation has subsided.
👤WHO WAS INVOLVED: The Federal Reserve, Fed Chairman Jerome Powell, the Federal Open Market Committee, President Donald J. Trump, and American borrowers and consumers.
📍WHEN & WHERE: Chairman Powell will announce the central bank’s policy on the federal funds rate on Wednesday, June 18, 2025.
💬KEY QUOTE: “Some members have been expressing concerns about slowing growth, although very slightly, and that should be debated heavily as a driver to cut rates sooner rather than continuing to pause,” contends financial analyst Brian Mulberry, a client portfolio manager at Zacks Investment Management.
🎯IMPACT: President Donald J. Trump has repeatedly called on Powell and the Fed to begin reducing interest rates to energize the United States economy. However, since December of last year, the central bank has opted to hold rates at their current range of 4.25 percent to 4.5 percent.
The Federal Reserve Bank’s Federal Open Market Committee (FOMC) is widely expected to hold the federal funds rate steady, currently between 4.25 and 4.5 percent, following its June meeting, which ends on Wednesday. Currently, the CME Group’s FedWatch Tool indicates a 99.9 percent likelihood that the central bank will maintain current interest rates, despite mounting pressure from President Donald J. Trump to begin enacting cuts to borrowing costs.
Interest rates have remained unchanged since December last year, with the central bank claiming economic uncertainty related to the impact of President Trump’s tariff policies has forced them to hold off on a rate cut. However, thus far, Fed Chairman Jerome Powell’s concern that the tariffs could restart inflation has been largely unfounded. In fact, recent economic data has shown inflation significantly cooling, with the current rate hovering very close to the central bank’s two percent target. Additionally, some recent economic data suggests the American economy could even be facing deflationary pressures, which would generally push the Federal Reserve to cut rates.
In recent months, President Trump has blasted Chairman Powell, calling him a “loser” and arguing that the central bank chief “has always been ‘Too Late'” on adjusting rates to changing economic conditions. Notably, in April, Trump indicated he may soon move to dismiss Powell as Federal Reserve chairman, though that will likely be contingent on a pending court case.
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