Central bank sets rates at range between 3.75% and 4% amid turbulence from government shutdown and Trump’s tariffs
The US Federal Reserve cut interest rates on Wednesday, the second rate cut this year amid economic turbulence from the federal government shutdown and Donald Trump’s tariffs.
The decision to cut the Fed’s benchmark interest rate by a quarter point to a range of 3.75% to 4% comes at an extraordinary moment for the central bank. The Fed has been under immense pressure from Donald Trump to cut rates despite persistent inflation.
In a statement, the Fed said that the unemployment rate had gone up but remains low. “Job gains have slowed,” the statement reads. “Inflation has moved up and remains somewhat elevated.”
The ongoing federal government shutdown, now one of the longest in US history, has also complicated the Fed’s job. Collection of important economic data has been indefinitely halted as employees at the Bureau of Labor Statistics (BLS) are furloughed during the shutdown.
