Fed keeps interest rate unchanged, as expected

ISTANBUL

The US Federal Reserve held its benchmark federal funds rate unchanged Wednesday in the 4.25%-4.50% range, in line with forecasts.

"The Committee (Federal Open Market Committee) seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run," it said in a statement. "Uncertainty about the economic outlook has increased further. The Committee is attentive to the risks to both sides of its dual mandate and judges that the risks of higher unemployment and higher inflation have risen.”

It stated that the committee is strongly committed to supporting maximum employment and returning inflation to its 2% goal.

"The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals," the Fed added.

The decision came after uncertainty caused by tariffs and US President Donald Trump's repeated criticisms of Fed Chair Jerome Powell, accusing him of failing to act swiftly as economic risks mount.

Trump repeatedly demanded that the Fed cut interest rates, citing moves by European central banks and warning that delays could stall the US economy.

He wrote April 7 on social media that now is “a PERFECT time to cut rates” but Powell “is always late.” Ten days later, he posted: “Jerome Powell of the Fed, who is always TOO LATE AND WRONG, yesterday issued a report which was another, and typical, complete ‘mess!’”

He added that “termination cannot come fast enough!” referring to Powell.

Trump claimed April 21 that Powell’s reluctance to cut rates could lead to a slowdown in the US economy.

The bank, keeping the rate at the historically high level of 5.5% from July 2023 to September 2024, has gradually lowered it to 4.5%.