Fed Keeps Interest Rates Unchanged Amid Slower Growth and Higher Inflation

On Wednesday (June 18, 2025), the Federal Reserve maintained its interest rates steady amidst forecasts of increased inflation and slower growth in the near future. Officials at the Fed continue to signal towards two rate cuts by the end of the year. Specifically, they kept the interest rates unchanged while predicting two rate cuts for 2025, stating that uncertainty about economic prospects remains high but has decreased. The officials also downgraded their estimates for economic growth this year and raised forecasts for unemployment and inflation. Speaking to reporters after the decision, Fed Chairman Jerome Powell reiterated his stance that the central bank is “in a good position to wait and learn more about the likely trajectory of the economy before considering any adjustments to our policy stance.” Although the median expectation for two rate cuts in 2025 hasn’t changed, several officials have revised their projections. Seven officials no longer foresee any rate cuts this year compared to four in March. Two others indicated one cut this year.