The Federal Reserve left rates unchanged in May and described uncertainty around the economic outlook as elevated. Trade policy made both growth and inflation harder to forecast.
Two risks pulled in opposite directions
Higher prices could argue for patience, while weaker hiring could eventually support easing.
Waiting preserved options
A hold let officials observe data without committing to one interpretation of the policy shock.
Household rates stayed product-specific
Mortgage, card, auto, and savings rates continued to respond through different market channels.
Sources
- Federal Reserve Board, FOMC Statement, May 7, 2025.