May 6, 2025 / 9:02 AM EDT / CBS News
President Trump has been urging the Federal Reserve to cut interest rates, criticizing their delay in making reductions. The Fed is scheduled to convene on Wednesday to determine its next move, but Trump may have to wait for the rate cuts he desires.
Forecasts from CME Group's FedWatch indicate a 99% probability that the Federal Reserve will maintain the federal funds rate within the current range of 4.25% to 4.5% at the May 7 meeting, unchanged since December's rate adjustment.
Amid mixed economic signals, the U.S. economy faces uncertainties with GDP declining in the first quarter but positive job growth in April. Concerns over recession risks have escalated due to the impact of Trump's tariffs, which have led to increased import costs for American consumers.
Fed Chair Jerome Powell has emphasized a patient approach, waiting for economic policies to unfold before making any rate adjustments. The Fed is likely to maintain its current stance and emphasize the need for further data, with expectations of three rate cuts in 2025, potentially starting in the summer.
Economists project minimal chances of rate adjustments in the upcoming meetings, with a focus on stability. Borrowers seeking relief may face delays, with expectations of rate cuts potentially in July.
Financial uncertainties may result in higher credit card and auto loan rates, prompting consumers to explore options for better rates. Analysts suggest monitoring the evolving economic landscape and taking proactive steps to manage borrowing costs effectively.
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