The US Federal Reserve has held interest rates unchanged, defying calls from Donald Trump for an immediate cut.
In a statement, the Fed said:
“The unemployment rate remains low, and labour market conditions remain solid. Inflation remains somewhat elevated.”
Reaffirming its long-term goals, the central bank added:
“The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run. Uncertainty about the economic outlook remains elevated. The Committee is attentive to the risks to both sides of its dual mandate.”
As expected, the Fed maintained the federal funds rate at 4.25% to 4.50%, marking its fifth consecutive meeting without a change in policy.
Wall Street Edges Higher After Fed Holds Rates Steady
US stocks ticked slightly higher in choppy trading on Wednesday evening, following the Federal Reserve’s decision to keep interest rates unchanged — a move that had been widely anticipated by markets.
Equities were already modestly higher ahead of the announcement, as investors digested stronger-than-expected headline figures for second-quarter economic growth. However, underlying data suggested the economy may be starting to lose momentum, tempering optimism.
Fed Has ‘Chosen Independence Over Political Capitulation’, Says Wealth Manager
The Federal Reserve has upheld its independence by resisting political pressure to cut interest rates, according to Isaac Stell, investment manager at Wealth Club.
“President Trump will, once again, take umbrage at this latest decision,” Stell said, noting that Trump had demanded the Fed “MUST NOW LOWER THE RATE” ahead of the announcement.
“Despite the sustained pressure, Jerome Powell and his deputies have once again defied the president’s wishes and chosen independence over political capitulation,” he added.
