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Fed Leaves Interest Rates Unchanged, For Now
The Federal Reserve voted late Wednesday to leave its benchmark lending rate unchanged at 2.25%-2.5%. But the central bank also signaled strongly that it will lower the rate later this year if the economic outlook dims.
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The Federal Reserve voted late Wednesday to leave its benchmark lending rate unchanged at 2.25%-2.5%.
But the central bank also signaled strongly that it will lower the rate later this year if the economic outlook dims. Many investors believe a quarter-point reduction will come at the end of July, when the Fed next meets.
Fed Chairman Jerome Powell says the bank is closely monitoring the growing likelihood of prolonged trade tensions and what they would mean for the U.S. and other economies. Analysts say the Fed’s change in tone signals an impending rate reduction, unless next month’s economic indicators all are strong.
The bank’s decision not to change rates immediately deftly deflects President Donald Trump’s demand for a rate cut now. But the Fed also recognizes the negative impact on the U.S. and other economies of an escalating trade war with China.
Powell tells reporters that many central bank officials want more time before agreeing to lower rates.
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