The Federal Reserve kept the funds rate at 4.25%–4.50% for a third consecutive meeting in May 2025, in line with expectations, as officials adopt a wait-and-see approach amid concerns that President Trump's tariffs could drive up inflation and slow economic growth. Policymakers noted that uncertainty about the economic outlook has increased further and that the risks of higher unemployment and higher inflation have risen. The Fed also said that that although swings in net exports have affected the data, recent indicators suggest that economic activity has continued to expand at a solid pace. The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid. Inflation remains somewhat elevated.

Source: Trading economi