Fed expected to pause further rate cuts after three reductions; duration unclear

The Federal Reserve is widely expected to hold interest rates steady on Wednesday after three quarter-point cuts in the final months of 2025, officials and economists said, though how long that pause will last is uncertain. Officials have lowered rates into a range of 3.5 percent to 3.75 percent and say a steadily growing economy and low layoffs have reduced pressure to move quickly.

Policymakers are balancing the risk of harming the labor market by keeping rates too high against the need to restrain the economy enough to bring inflation back toward the 2 percent target; inflation, the article says, remains above that goal and economists warned it is still a problem.

The Fed also faces political strain from the White House. The piece reports that President Trump has assailed the central bank for not cutting faster, that Jerome H. Powell accused the administration of opening a criminal investigation into his handling of renovations in retaliation, and that Governor Lisa D.

Cook was forced to defend her ability to remain after a removal effort that reached the Supreme Court, where several justices appeared wary of allowing political meddling. Economists and some Fed officials expect a prolonged pause unless the labor market weakens. The article notes Mr.

Key Topics

Business, Federal Reserve, Jerome Powell, Donald Trump, Interest Rates, Inflation