US Fed Meeting LIVE: The US Fed decided to keep the key benchmark interest rates unchanged at the range of 4.25% to 4.5% on Wednesday, May 7, 2025, amid global uncertainty caused by the raging trade war, a slowing economic growth in the nation, and unstable inflation trends.
“The Committee decided to maintain the target range for the federal funds rate at 4-1/4 to 4-1/2 per cent. In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks,” said the FOMC in the official release.
US Fed Chairman Jerome Powell said that he is in no hurry to cut interest rates due to the high level of uncertainty in the US economy, along with the inflation risk imposed by the high tariffs on imports. Powell highlighted that the committee is poised to observe and analyse the economic situation in the nation ahead of a rate cut.
In its March 2025 policy announcement, the US Fed kept the key benchmark lending rates unchanged at 4.25 to 4.50 per cent, projecting a two-quarter-percentage point rate cut by the end of this year.
The United States’ economic data shows that the GDP contracted at a 0.3 per cent annualised rate in the first quarter of 2025 amid trade war concerns between the United States and other world nations. Even though US GDP data took a hit, the payroll data for April 2025 showed that employment jumped 1,77,000, while the Personal Consumption Expenditures (PCE) Price Index was unchanged in March after rising 0.4 per cent in February.
In the March policy meeting, Powell reiterated that he is not in any hurry to impose an interest rate cut on the US economy despite geopolitical concerns.
“The committee would be prepared to adjust the stance of the monetary policy as appropriate if risks emerge that could impede the attainment of the goals,” said the FOMC in the March policy announcement.
