Overview

• The Federal Reserve maintained its benchmark interest rate at 4.25%–4.5%, citing insufficient data to justify a policy change.
• President Trump renewed public attacks on Fed Chair Jerome Powell, pressuring the central bank to lower rates despite inflation risks from tariffs.
• Fed officials, including Cleveland Fed President Beth Hammack, emphasized the need for clear evidence on the economic effects of tariffs before adjusting rates.
• St. Louis Fed President Alberto Musalem warned against prematurely committing to rate cuts, highlighting the potential for persistent inflation from tariffs.
• Financial markets are pricing in a modest probability of a July rate cut, though Fed officials remain cautious given ongoing economic uncertainties.