Fed keeps interest rates unchanged and plans two more cuts in 2025

On Wednesday, the Federal Open Market Committee voted to keep the federal funds rate in the range of 4.25% to 4.5%. The regulator also released an economic forecast for the first time since US President Donald Trump imposed large-scale tariff duties. The officials predict a slowdown in economic growth, higher inflation, and rising unemployment.

Following the meeting, Federal Reserve Chair Jerome Powell emphasized the need for greater clarity on the future trajectory of the US economy before making adjustments to monetary policy.

Currently, according to Bloomberg, Fed officials are still planning two more interest rate cuts this year.

In their updated economic forecasts, officials raised their median estimate for inflation at the end of 2025 to 3% from 2.7%. US economic growth expectations were downgraded from 1.7% to 1.4%. The unemployment rate is expected to settle at 4.5%, exceeding earlier projections.