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Fed Holds Interest Rates Steady, Citing Trump’s Tariffs Despite Push for Cuts
In a surprise move, the Federal Reserve has announced its decision to maintain interest rates steady at 4.25%-4.5%, disregarding President Trump’s repeated calls for rate cuts. The unusual step is a direct response to the uncertainty caused by Trump’s tariffs, which have led to a significant increase in economic instability.
According to sources, Fed Chair Jerome Powell emphasized that the central bank is carefully monitoring the situation and will reassess its position if the market dynamics change or if the impact of Trump’s policies becomes clearer. This stance is seen as a bold move, as it goes against the widespread expectations of a rate cut.
The decision comes amidst growing tensions between the administration and the Fed over monetary policy. The central bank has been under pressure from President Trump to slash interest rates further, which could boost economic growth but also fuel inflationary pressures. However, officials are hesitant to act without considering the broader economic implications of Trump’s trade policies.
In a press statement, Powell highlighted the uncertainty caused by the tariffs, stating that “the committee will carefully assess incoming data and evolving outlook before making any changes.” The move is expected to send a strong signal that the Fed remains committed to its dual mandate of maximum employment and price stability.
The market reacted swiftly to the news, with Bitcoin consolidating around the $118K level. The cryptocurrency’s value has been largely unaffected by the Fed’s decision, which is likely due to the lack of clear implications for crypto assets.
Source: coinpedia.org
