Despite repeated demands from U.S. President Donald Trump to cut interest rates, the Federal Reserve (Fed) has once again decided to leave them unchanged, reaffirming its independence in the face of mounting pressure from the executive branch.
The announcement came Wednesday from Washington, where the Federal Open Market Committee (FOMC) confirmed that the target range for the federal funds rate will remain between 4.25% and 4.5%—a historically high level aimed at curbing inflation without abruptly halting economic growth. This marks the fifth consecutive meeting in which the Fed has opted to hold rates steady, fueling growing frustration within the White House.
Trump, who has made economic expansion a cornerstone of his political platform, has intensified his criticism of Fed Chair Jerome Powell, accusing him of excessive caution and risking the country’s economic momentum. During a tense press conference last week, Trump and Powell appeared together for the first time in months.
The encounter proved uncomfortable, revealing deep disagreements—not just on monetary policy, but also on administrative issues such as the cost of renovating the Fed’s headquarters, which became a point of public dispute between the two leaders. The Republican president continues to argue that lowering interest rates would boost investment, stimulate consumer spending, and improve the competitiveness of U.S. exports.
Powell, however, remains firm in his stance, stating that inflationary risks still persist—some of which stem from the administration’s own policies, like import tariffs that could drive up consumer prices and increase inflationary pressure. "It is our duty to make decisions based on objective economic data, not political cycles,"
Powell reiterated, receiving support from a majority of economists who favor caution in today’s volatile global economic climate. Meanwhile, financial markets reacted calmly, as the decision aligned with analysts’ expectations. Nevertheless, political uncertainty could have a medium-term impact if tensions between the White House and the Federal Reserve continue to escalate.
