The US Central Bank released the details of the May meeting that maintained the interest rate at 4.25% to 4.50%; Analysts await greater security for Trump’s tariffs
The Fed (Federal Reserve, Central Bank of the United States), said on Wednesday (28.MAI.2025) that the maintenance of interest rate at the level of 4.25% to 4.50% at the meeting of the FOMC (Federal Market Committee) of May 6 and 7 was due to the risk of inflation and the scenario of ““considerable uncertainty”In the economy. The statement took place in the Minutes of FOMC. Eis and of the statement (PDF – 440 KB).
“Participants observed there to be a considerable uncertainty around the evolution of trade policy, as well as the scale, the scope, the moment and the persistence of the associated economic effects. Together, the participants considered uncertainty exceptionally high over their economic perspectives.”said the minutes.
According to the statement, the FOMC opted for a “Cautious approach” until the effects of tariffs “Become clearer”. US President Donald Trump (Republican Party) has announced a series of tariffs since his own, which increased the fear of the market for an economic recession.
Despite not citing the Republican directly, the minutes of the meeting mentions that the policies of the US agent “They implied a greater obstacle to the actual activity” of the country’s economy.
The document analyzes that “Several inquiries indicated a sharp deterioration in the consumer’s feeling” because of the increase in cost related to.
“Participants observed, however, that the final extension of changes in government policy and their effects on the economy was highly uncertain. Some participants also observed that greater uncertainty could restrict business and consumer demand.”said the minutes of FOMC.
The US interest rate has been within the same break since December 2024. From then on, all minutes of Central Bank meeting cite, not directly mentioning Trump, the uncertainty that republican government decisions can cause in the country.
The main indicator considered in decisions is inflation, as the change in interest rate seeks to control the inflationary increase.
Inflation in the USA
The annualized inflation of the United States. The rate dropped 0.1 percentage point compared to, when it was 2.4% in the accumulated 12 months.
Monthly inflation was 0.2%. The monthly discharge was mainly pulled by housing prices, which rose 0.3% and answered for more than half of the advance in the month. Despite the moderate level, Fed directors maintained concerns about increasing inflation with Trump’s upcoming measures.
The next FOMC meeting will be held on July 17 and 18, when the Fed Committee will decide whether to keep or alter the interest rate.
