WASHINGTON, D.C. – The Federal Reserve said unemployment rates remain low and the economy is relatively stable but they’ve decided to keep federal interest rates the same, for now. They cited economic uncertainty as one of the factors keeping the rates the same. However, they do expect to cut rates later on this year.
Any changes to federal interest rates could impact mortgages, credit cards and loans. The higher the rate could make borrowing more expensive for businesses and consumers. When federal interest rates are lowered, it usually means it makes borrowing money less expensive. Federal Reserve Chairman Jerome Powell announced they will maintain their rates at the current rate around four and a half percent. Their ultimate goal is to get it much lower than that, to around two percent.
Powell said they expect weaker growth, higher inflation and a little bit more unemployment later this year than they have previously forecasted before the president announced wide scale tariffs.
“We will continue to monitor the appropriate monetary policy depending on the incoming data, the evolving outlook and the balance of risks,” said Powell. “Changes to trade, immigration, fiscal regulatory policies continue to evolve and their effects on the economy remain uncertain.”
During President Trump’s time in office, rates have remained unchanged. He has encouraged the Reserve to lower them. Ahead of the Reserve announcing they are keeping the rates the same, Trump commented that he believes Powell has done a poor job leading the Federal Reserve, even calling him “stupid”.