The Federal Reserve announced on June 18, 2025, that it will maintain its benchmark interest rate at 4.25–4.5% for the fourth consecutive meeting—even amid calls from President Trump for cuts. The Fed acknowledged that inflation has eased slightly but cited economic uncertainties, including tariff-related price pressures and a still-solid labor market, as reasons to hold steady.
Inflation projections have ticked upward, reflecting the pass-through from recent tariffs. Fed Chair Jerome Powell emphasized caution, explaining that while job growth remains strong and unemployment is low at 4.2%, inflation is not yet consistently under control. The Fed’s quarterly forecasts still signal the possibility of two rate cuts in 2025, although seven of 19 policymakers now believe no cuts will be necessary.
President Trump sharply criticized Powell—calling him a “stupid person” and questioning his competence after the Fed refused to lower rates. Trump suggested he could manage monetary policy better and hinted at nominating a successor before Powell’s term ends in May 2026.
