Federal Reserve interest rate decision in 2025
Federal Reserve officials decided to keep interest rates unchanged in their first policy decision of 2025, citing solid economic activity, stable unemployment rate, and somewhat elevated inflation. They are balancing risks of inflation and a softer labor market, pausing the cutting cycle to assess the economy and considering the impact of President Donald Trump's policies.
Key Points
- Fed left interest rates unchanged
- Balancing risks of inflation and a softer labor market
- Pausing cutting cycle to assess economy
- Considering impact of President Donald Trump's policies
Pros
- Solid economic activity
- Stable unemployment rate
- Labor market conditions remain solid
Cons
- Elevated inflation
- Concerns about inflation expectations due to tariffs
- Uncertainty about President Donald Trump's policies