Jerome Powell Strikes Hawkish Tone, Holds Rates & Defends Decision Against Trump Pressure

The U.S. Federal Reserve has held interest rates steady despite political pressure from U.S. President Donald Trump. Though two FOMC members voted for a rate cut, the majority prevailed with their decision, citing still-elevated inflation alongside solid economic growth, and giving little indication in its latest policy statement of when borrowing costs might fall again. The decision to maintain borrowing costs at their current level puts the Fed's current monetary easing cycle, begun near the end of the Biden administration and continued after a pause of roughly nine months during President Donald Trump's second term in the White House, on hold again after three quarter-percentage-point reductions at the central bank's final three meetings of 2025. It's a debate that could shape the first weeks in office of whoever is named to replace Powell in the top Fed job, a decision that Trump is expected to announce soon. Powell's successor is expected to be in place to run the central bank's meeting in June. Investors currently expect the Fed to keep rates on hold until then.