Fed holds interest rates for fourth time despite tariff turmoil

June 18, 2025

The Federal Reserve held interest rates for the fourth time this year despite the ongoing trade conflict. The decision comes as central banks worldwide grapple with heightened market volatility and uncertainty. The Fed's decision was unanimous, with all policymakers committing to keeping rates unchanged until 2024. This move aims to sustain economic recovery and promote employment, despite inflation remaining below the target level. The central bank's statement also noted risks to the outlook, including uncertainties stemming from the global economic backdrop and muted inflation pressures.

What's Next?

The Fed's decision reflects a cautious approach in the face of heightened uncertainties and is consistent with its commitment to supporting robust employment growth. Moving forward, policymakers will closely monitor developments, including traction in inflation, the labor market's performance, and the ongoing trade tensions. This cautious stance aligns with global efforts to stimulate economic activity and mitigate the impact of heightened market volatility on growth prospects.