Despite pressure by President Donald Trump to lower interest rates, including via a trumped-up case by the Department of Justice, US Federal Reserve Chairman left the main central bank interest rate unchanged at the 3.5-3.75% range. The US Federal Reserve Chairman highlighted that inflation in goods is increasing mainly due to tariffs while there is disinflation in services. The labour market, except for public jobs, remains strong and the unemployment rate remains low.
The Federal Reserve said that its decision is in line with its goal to bring inflation down to 2%. The expectation by the central bank is that inflation cools down by the middle of the year because tariffs are expected to provide just a one-time bump in prices rather than long-term inflation.
Chairman Powell refused to make any comments about the value of the US Dollar questioned about its weakness during the past few weeks. The Euro has been strengthening against the US Dollar since last year and has also hit $1.2 this week.
The US Federal Reserve also released a Statement on Longer-Run Goals and Monetary Policy Strategy to reiterate its long term goals which are primarily to ensure full employment and stable prices across most goods and services.
You can watch the full press conference here.
Newsroom
Leave a Reply