The U.S. Federal Reserve left its benchmark interest rate unchanged on Wednesday, maintaining the target range at 4.25% to 4.50%, despite mounting pressure from the Trump administration to ease borrowing costs.

The decision, announced at the conclusion of the Federal Open Market Committee’s (FOMC) two-day policy meeting, came as recent data pointed to a slowdown in economic momentum and persistent inflation.

“Although swings in net exports continue to affect the data, recent indicators suggest that growth of economic activity moderated in the first half of the year,” the Fed said in a statement. 

“The unemployment rate remains low, and labor market conditions remain solid. Inflation remains somewhat elevated.”

The central bank acknowledged that uncertainty surrounding the economic outlook remains elevated, as it reaffirmed its commitment to achieving maximum employment and returning inflation to its 2% target.

The decision follows Commerce Department figures released earlier Wednesday showing that the U.S. economy grew at an annualized rate of 3.0% in the second quarter, following a 0.5% contraction in the first.

The Consumer Price Index (CPI) rose 2.7% year-on-year in June, marking the sharpest increase since February—widely attributed to the impact of tariffs on goods.

Among the 12 voting FOMC members, two dissented, favoring a 25-basis-point rate cut. One Fed board member abstained from voting.

The move underscores a cautious stance by the Fed amid political pressure from the White House, which has repeatedly called for lower interest rates to support growth ahead of the 2026 election.

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