Fed holds US interest rates steady, resists Trump's pressure to cut

• Fed keeps US interest rates steady at 4,5%
• Trump presses Powell to cut interest rates
• US inflation still exceeds Federal Reserve target

The Federal Reserve decided to keep interest rates unchanged for the third consecutive time, maintaining the range between 4,25% and 4,5%. The decision was taken unanimously and reflects a cautious stance, even in the face of public pressure from former President Donald Trump, who has insisted on cuts to boost the economy.

The Fed justified the decision by citing increased economic uncertainty, but noted that U.S. economic activity remains solid. Recent data show that the economy contracted in the first quarter, influenced by an anticipation of imports ahead of the application of new trade tariffs imposed by Trump.

Despite this one-off decline in GDP, the labor market remains resilient. April employment reports indicate stability in the unemployment rate, even after the impact of Trump’s so-called “Liberation Day” announcements.

The central bank also expressed concern about inflation, which remains above its 2% target. Although the Fed's preferred indicator pointed to a slowdown in price growth to an annualized rate of 2,6% in March, the accumulated rate for the quarter was still 3,5%.

The rate-keep-keep comes amid a rhetorical offensive from Trump that has increased pressure on Fed Chairman Jerome Powell. The former president has accused him of acting too slowly and even called him “Mr. Too Late” in posts on Truth Social, saying rate cuts are urgent to avoid a new slowdown.

Even with criticism and the increase in tariffs on products from partner countries, the Federal Reserve remains focused on economic data to support its decisions, without giving in to political appeals.