The Federal Reserve is anticipated to maintain steady interest rates on Wednesday as it evaluates the impact of President Trump’s tariffs and geopolitical tensions on the U.S. economy. Since December, the Fed has paused rate cuts after reducing them by a full percentage point last year. According to the CME Group’s FedWatch tool, investors are confident that the central bank will keep its benchmark interest rate between 4.25% and 4.5%.
Inflation has remained relatively stable recently, though concerns persist about potential price pressures from tariffs. The Fed is also monitoring the combined effects of Trump’s policies on taxes, regulation, and immigration. A decline in the foreign-born workforce could exert upward pressure on inflation in sectors reliant on immigrant labor. Despite cooling demand for workers, the unemployment rate remains low at 4.2%.
— new from NPR