The Federal Reserve has opted to maintain its benchmark interest rates in the range of 4.25% to 4.5%, despite ongoing pressure from President Donald Trump, who has been vocal about his dissatisfaction with the central bank's monetary policy.

This decision marks the third consecutive meeting in which the Fed has left interest rates unchanged, following a series of rate cuts that began in September.

Initially, the central bank reduced rates by 50 basis points, after having kept them steady for almost fourteen months at levels last seen in January 2001.

The Fed's recent meetings took place against a backdrop of political tension, with Trump accusing Fed Chair Jerome Powell of hindering economic growth by being slow to respond to calls for rate cuts, especially when compared to the European Central Bank, which has implemented multiple cuts.

Trump has publicly suggested that the Fed's monetary policy might lead the U.S. into recession and even threatened Powell's position.

Despite Trump's criticisms, the Federal Open Market Committee (FOMC) remains committed to a careful examination of economic conditions before making any adjustments to rates.

Their unanimous decision to hold rates steady reflects a consensus on the need to better understand the economic effects of current policies.

In its latest statement, the Fed acknowledged an increase in uncertainty surrounding economic forecasts, noting that risks of higher unemployment and inflation have also escalated.

The U.S. gross domestic product (GDP) contracted by 0.3% year-on-year in the first quarter, driven by rising imports as companies stockpiled goods ahead of tariffs.

This contraction comes amid a record trade deficit of approximately $140.5 billion, underscoring the strain on the economy.

The Fed indicated that while export fluctuations are impacting data, recent indicators suggest a continued solid pace of economic expansion.

The unemployment rate held steady at 4.2% in April, with the economy adding 177,000 jobs, a number that, while lower than the previous month, surpassed analyst expectations.

Despite the pressure on prices, the Fed noted that inflation remains somewhat elevated.

The Personal Consumption Expenditures price index—the Fed's preferred inflation measure—moderated to 2.3% in March from 2.7% in February.

The core PCE inflation rate also decreased to 2.6%.

In a press conference, Powell stated that the Fed's decisions are based solely on economic data and the balance of risks, dismissing the notion that political comments could influence their actions.

He emphasized the uncertainty surrounding the economic impact of tariffs, which could have varied durations depending on the scope of the tariffs themselves.

Powell advised patience regarding interest rate adjustments, suggesting the need to observe more data before making further changes.

Many analysts have warned that the true effects of tariffs may take several months to fully materialize.

The temporary trade reprieve granted by Trump to negotiating countries, with the exception of China, is set to last until July, at which point the market anticipates a resumption of rate cuts by the Fed.