The Federal Reserve held rates steady on Wednesday for the fifth-straight time at the Federal Open Market Committee meeting. The bank kept interest rates between 4.25% and 4.5%.
“Higher tariffs have begun to show through more clearly to prices of some goods, but their overall effects on economic activity and inflation remain to be seen,” said Chairman Jerome Powell at the meeting.
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Two members of the Board of Governors appointed by President Donald Trump dissented and suggested lowering interest rates by one-quarter of a percentage point. Still, the decision was expected by most experts. Inflation is at 2.7%, as of press time, higher than the Fed’s preferred 2% number.
“Our obligation is to keep longer-term… inflation expectations well anchored and to prevent a one-time increase in the price level from becoming an ongoing inflation problem,” Powell said.
Elyse Ausenbaugh, head of investment strategy at J.P. Morgan Wealth Management, told Entrepreneur that the data didn’t justify a rate cut today.
“I don’t think there would have been much upside to Powell signaling that one was imminent,” Ausenbaugh wrote in an email. “The data, as it stands today,