The Fed operates with a dual mandate of keeping the labor market healthy while maintaining stable prices. At the moment, the labor market remains solid and inflation, while not at the 2% annual level the Fed desires, has come down significantly. That could change if some of the more aggressive Trump tariffs take effect.

The Fed is in a “good place to wait and see” before moving on interest rates, Powell said Wednesday. “We don't think we need to be in a hurry. We think we can

The Federal Reserve kept its key interest rate unchanged Wednesday, brushing off President Donald Trump’s demands to lower borrowing costs, and said that the risks of higher unemployment and higher inflation have risen.