Federal Reserve Board Chairman Jerome Powell announced Wednesday that the policy interest rate will remain at 4.25 to 4.5 percent for now. The announcement, though not unexpected, comes despite pressure from President Donald Trump urging the Fed to lower the rate.
“There is so much we don’t know,” Powell told reporters. “We are in a good position to wait and see.”
“Although swings in net exports have affected the data, recent indicators suggest that economic activity has continued to expand at a solid pace. The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid. Inflation remains somewhat elevated,” the Fed said in a statement.
Noting that it seeks to achieve maximum employment and inflation at the rate of two percent over the longer run, the Committee noted that 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,” the statement said.
In support of those goals, the Committee said it decided to maintain the target range for the federal funds rate at 4.25 to 4.5 percent, adding that it will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities.
