The Federal Reserve kept its forecast for two rate cuts this year amid Trump's tariffs, which are expected to push up inflation and slow the economy

The Fed’s decision, along with new economic projections and a news conference with Jerome H. Powell, the chair, shed additional light on the path ahead for borrowing costs. The Fed sees little urgency to lower interest rates anytime soon.

There are good reasons to think the Federal Reserve would be preparing to cut interest rates this week due to recent improvements on inflation—if not for [the risk that tariffs pose to prices](

The Federal Reserve held its key interest rate steady for the fourth time this year on Wednesday, leaving its benchmark lending rate unchanged at a range of 4.25 percent to 4.5 percent. For homebuyers, this means that mortgage rates are likely to keep hovering around the 7-percent mark for the foreseeable future.

The Fed also forecasted two quarter-point interest-rate cuts over the remainder of 2025, carrying over a prediction issued in March. Two additional quarter-point cuts will be made in 2026, as well as one quarter-point cut in 2027, the central bank said.

Equities briefly extended gains after the Fed decision, with the S&P 500 topping 6,000. Treasury yields dropped across the curve. The dollar slipped. U.S. financial markets will be closed Thursday for Juneteenth.