The Federal Reserve has decided to keep interest rates between 3.5% and 3.75%. Two Fed governors voted against the move, and instead backed a rate cut, while 10 officials were in favor of leaving rates the same.
The US Federal Reserve on Wednesday announced that it will keep interest rates unchanged.
The central bank will keep the target range for the federal funds rate between 3.5% and 3.75%. The Fed had lowered rates three times last year.
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"Available indicators suggest that economic activity has been expanding at a solid pace," the bank said in a statement. "Job gains have remained low, and the unemployment rate has shown sign of stabilization. Inflation remains somewhat elevated."
Ten of the 12 members of the Federal Open Market Committee voted for the policy, with two dissenting. Fed Governors Stephen Miran and Christopher Waller, both appointed by US President Donald Trump, were in favor of a quarter-point rate reduction.
Federal Reserve Chair Jerome Powell was one of the 10 members who voted in favor of keeping the rates as they are.
To boost the economy, the Federal Reserve will lower interest rates to stimulate borrowing. During times of high inflation, as seen in recent years, the Fed will often raise rates to keep the economy from overheating.
Trump, in recent years, has frequently chided Powell for not lowering rates, calling him "too late."
US Attorney for the District of Columbia and Trump ally Jeanine Pirro has launched a criminal investigation into Powell regarding the renovations of historic buildings. Powell said the probe was political pressure to influence the Fed on monetary policy.
Powell's term as chair ends in 2026. Trump is then expected to nominate Powell's successor for the role.
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Trump has also attempted to fire Lisa Cook, a Fed governor who had been nominated by Trump's predecessor, Democratic President Joe Biden. Cook has challenged her dismissal and her case is being deliberated by the US Supreme Court.
The Fed is independent from the administration in power and does not have to abide by the president's demands. Powell said he believes the bank will keep its independence, as it "has served the people well."
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