Federal Reserve Chairman Jerome Powell indicated that the Fed is in no rush to cut interest rates, citing uncertainty over the economic impact of President Trump’s tariff policies. While Trump called for rate cuts to address inflationary pressures, Powell emphasized that the Fed would wait for more clarity on economic conditions before making any decisions. The Fed has lowered its growth forecast for the year and anticipates inflation will remain slightly above target.

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• Fed Chairman Jerome Powell emphasized high uncertainty and a lack of clarity in economic conditions.
• The Fed held its interest rate steady at 4.25%-4.50%, with no immediate plans to cut rates.
• President Trump disagreed, urging the Fed to cut rates as tariffs impact the economy.
• Powell warned that Trump’s tariff policies could lead to higher inflation and slower growth.
• The Fed downgraded its 2023 growth forecast from 2.1% to 1.7%.
• Inflation is expected to end the year at 2.7%, slightly above the 2% target.
• Powell said the Fed is not in a hurry to change rates but will act if necessary.
• The Fed is watching how tariffs affect consumer prices and inflation expectations.
• Powell noted that risks have shifted toward slower growth, higher unemployment, and inflation.
• The Fed also announced it would slow the drawdown of its $6.81 trillion balance sheet.