Amid various policy changes in the US, the Federal Reserve has decided to keep borrowing costs steady. Despite concerns about the economy, the central bank has chosen to leave its key interest rate at 4.3% for the fourth consecutive time, maintaining the rate since December. This decision comes as officials anticipate slower growth, higher unemployment, and increased inflation compared to previous expectations.

The Federal Reserve typically adjusts borrowing costs based on economic conditions, lowering rates during economic downturns and raising them to combat rapid inflation. In May, inflation exceeded the Fed's 2% target, reaching 2.4%. President Donald Trump has urged the Fed to lower interest rates, citing diminishing concerns about inflation. However, Fed officials have emphasized the importance of data-driven decision-making, particularly regarding the impact of tariffs and other policy changes on prices and the US economy.

Despite acknowledging a "solid" economy overall, the Fed's projections indicate a downward revision in growth expectations to 1.4% for the year, down from the 1.7% forecast in March. Inflation forecasts have been revised upward to approximately 3%, compared to the 2.7% prediction in March, with an expected increase in the unemployment rate to 4.5%.

President Trump has continued to criticize Fed chair Jerome Powell, questioning his leadership and tenure. While other central banks have recently cut interest rates, the Federal Reserve remains committed to its current approach. Investment manager Isaac Stell suggests that the Fed is likely to maintain its neutral stance unless compelling reasons for a rate cut emerge.