Fed Holds Rates Steady as Trump Appointees Vote for Cuts

Resisting tremendous pressure from the Trump administration, the Federal Reserve held its key interest rate steady on Wednesday as two of President Donald Trump's appointees dissented from the decision and voted for cuts.

Wednesday's meeting reportedly marks the first time in more than 30 years that two members of the Fed's seven-member Board of Governors voted against a rate decision at the central bank.

Vice Chair for Supervision Michelle Bowman and board member Christopher Waller "preferred to lower the target range for the federal funds rate by one quarter of a percentage point at this meeting," according to the Fed's policy statement.

In announcing its decision, the Fed said that while economic growth had moderated in the first six months of 2025, inflation remained "somewhat elevated."

Fed Chair Jerome Powell voted to keep rates unchanged, as did three other board members and the five Fed regional bank presidents who currently sit on the rate-setting Federal Open Market Committee (FOMC).

Board member Adriana Kugler was absent from the meeting and did not vote.

Trump has been increasingly incensed by Powell's refusal to lower rates in recent weeks. At one point, the president was threatening to oust the Fed chairman before his term expires, though the legality of such a plan was unclear.

Last week, however, Trump appeared resigned to waiting until next May, when Powell's four-year term is up, to appoint a new chair.

"I think he's done a bad job, but he's going to be out pretty soon anyway," the president said at an event that aired live on Newsmax and the Newsmax2 free online streaming platform. "In eight months, he'll be out. But I call him 'Too Late.' He's too late all the time. He should have lowered interest rates many times. Europe lowered their rate 10 times. We lowered ours none, and it's causing a problem for people that want to buy a home."

With the Fed's next meeting scheduled for September, the question now becomes whether the central bank will make cuts then.

"The next two months' data will be pivotal and we see a path to a resumption of the Fed's easing cycle in the autumn should tariff inflation prove more modest than expected or the labor market show signs of weakness," Ashish Shah, a chief investment officer at Goldman Sachs, said in a note to clients after the decision was announced on Wednesday.

• Trump: I Hear Fed Will Slash Interest Rates in Sept.
• Stephen Moore to Newsmax: 3% GDP Growth Won't Spur Fed to Cut Interest Rates