The Federal Reserve again did not change interest rates after the latest Fed meeting, leaving interest rates between 4.25% and 4.50%. This is a straightforward thing in five months when interest rates were not reduced or raised. President Donald Trump has pushed the Fed to cut interest rates and has argued that his tariff policies will not boost inflation. However, Fed Chairman Jerome Powell and the central bank still consider inflation a threat enough to curb further cuts.
The decision comes amid an increase in economic uncertainty stemming from the US’s first tariff plan announced in early April. The Fed then chose to continue to commit to an on-the-scene approach to dealing with the war between inflation and future interest rate reductions.
According to Treasury data, the US annual inflation rate accelerated to 2.7% for the second consecutive month in June 2025. This is the highest level since February, rising in line with expectations, from 2.4% in May. Rising inflation is a sure sign that fees should not be cut yet. But the US President and his administration have asserted that the economy is doing well and cuts should come. As a result, Trump has publicly bashed because Fed Chairman Jerome Powell stalled the Fed’s cut rate, and it’s not even as long as he suggests that Powell will step down.
Some suggest that the decision to keep interest rates changing will cause ripples throughout the US Central Bank, potentially leading to Powell’s departure. Trump, who appointed Powell to the post during his first presidency, could lead a few cuts before the year ends if he decides to fire him.
