In an unsurprising move, the Federal Reserve has decided to leave the federal funds rate between 4.25% and 4.50%. The Fed’s decision came in line with CME’s FedWatch tool, which assigned 99.9% odds of the rate staying steady.
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Earlier today, President Trump urged the Federal Reserve to lower rates in order to reduce U.S. government interest payments on debt, saying “I’d do a much better job than these people. So anyway, we should be two points lower. It’d be nice to be two and a half points lower.”
Fed Raises Inflation Estimate, Lowers GDP Estimate
In its Federal Open Market Committee (FOMC) statement, the Fed noted that economic uncertainty has decreased but remains present. It also said that the labor market remains solid while the unemployment rate continues to be low.
However, the Fed lowered its 2025 gross domestic product (GDP) estimate to 1.4% from 1.7% in March. It raised its personal consumption expenditures (PCE) inflation estimate to 3.0% from 2.7%. The estimate for core PCE, the Fed’s preferred inflation gauge, was raised to 3.1% from 2.8%. Core PCE excludes volatile food and energy prices from the PCE.
Keep track of the federal funds rate and other key economic metrics with TipRanks’ Economic Indicators Dashboard.
