Federal Reserve holds steady on interest rates: the firm stance amid the White House’s erratic economic policy

On May 6, 2025, the Chairman of the Federal Reserve System of the United States announced that the Fed was keeping the U.S. discount rate at the previous level of 4.25-4.5%, noting that there were no expectations of a reduction in the discount rate at the next meeting.

Keeping the Fed’s discount rate at the current level on May 6, 2025, demonstrates the Fed’s readiness as an institution to resist political pressure and refuse to accelerate the reduction in borrowing costs for U.S. companies under the influence of Trump’s calls.

The decision was primarily driven by the ongoing uncertainty caused by the White House’s tariff policy and the resulting slowdown in the U.S. economy.