US Federal Reserve to keep rates unchanged at least until September – experts

The US Federal Reserve will keep interest rates at the current level for at least a few more months, as the risks of a resurgence in inflation due to Donald Trump’s tariff policy remain. This opinion is shared by most economists surveyed by Reuters.

The agency surveyed 105 economists, and with the exception of two, all predict that the Federal Open Market Committee (FOMC) will leave the federal funds rate unchanged at its June 17-18 meeting in the range of 4.25%-4.5%. It has been at this level since the beginning of the year.

More than half of the experts believe that the Fed will resume rate cuts next quarter, most likely in September, according to the pricing of interest rate futures. This forecast has not changed since last month.

42% of survey participants predict that the FOMC will resume rate cuts in the fourth quarter of 2025 or later. At the same time, 20 respondents do not expect a cut this year.

Experts have not come to a clear opinion on what the rate will be by the end of 2025, but about 80% believe that it will be 3.75-4% or higher.

Last week, U.S. President Donald Trump called for an immediate cut in the prime rate by a full percentage point to 3.25%-3.5%.

The monthly employment report published by the US Department of Labor shows that the labor market is not collapsing amid significant changes in trade policy. The unemployment rate remained stable at 4.2% in May. The data reinforces the position of Fed officials, who have made it clear that they are in no hurry to cut interest rates.

Inflation expectations remain elevated due to forecasts of high trade barriers in the United States. Economists predict that inflation will remain well above the Fed’s 2% target until at least 2027.

In early May, the Fed for the third time in a row kept its prime rate in the range of 4.25-4.5%. During a press conference after the announcement, Fed Chairman Jerome Powell noted that the tariffs had weakened consumer and business sentiment, but had not yet caused significant damage to the economy. According to him, there is too much uncertainty to say how the regulator should respond to the duties.