Fed leaves rates unchanged, sees no hurry to cut again

WASHINGTON - The U.S. central bank held interest rates steady on Wednesday and Federal Reserve Chair Jerome Powell said there would be no rush to cut them again until inflation and jobs data made it appropriate.

The decision and Powell's comments put Fed policy in a holding pattern at a time when the U.S. economic landscape seems both stable and wildly uncertain - with a healthy set of macroeconomic fundamentals that have changed little in recent months, but coming decisions from the Trump administration on immigration, tariffs, taxes and other areas that could prove disruptive.

Emerging from their first policy meeting during President Donald Trump's second term in the White House, Powell said Fed officials are "waiting to see what policies are enacted" before judging the effects on inflation, employment and overall economic activity, with no reason to adjust rates further until data either show a renewed decline in inflation or rising risks to the jobs market.

"I think our policy stance is very well-calibrated," Powell said in a press conference after the end of the Fed's latest two-day policy meeting. "The unemployment rate has been broadly stable for six months … The last couple of inflation readings … have suggested more positive readings."

In comments on his Truth Social media platform, Trump did not directly call for rate cuts, as he said he would do, but attributed the inflation that spiked in 2021 in the aftermath of the COVID-19 pandemic to the Fed spending too much time "on DEI (Diversity, Equity, and Inclusion), gender ideology, ‘green' energy, and fake climate change."

Trump returned to power last week with promises of import tariffs, an immigration crackdown, tax cuts and looser regulation.

Powell declined to respond to the Republican president's previous statements, but said, as he often has, that the central bank reacts to economic developments to try to maintain the lowest unemployment rate consistent with 2% annual inflation.

Recent key inflation readings remain about half a percentage point or more above the Fed's target, far lower than the 40-year highs seen in the aftermath of the pandemic.