Fed keeps rates unchanged in first meeting under Trump

Fed keeps rates unchanged in first meeting under Trump
© Greg Nash

The Federal Reserve opted not to raise interest rates in its first policy meeting since President Trump took the White House.

In a policy statement released Wednesday, the Federal Open Market Committee said it will keep rates unchanged at 0.5 to 0.75 percent.

The only notable change in the new policy statement from the Fed was that it noted growing consumer and business sentiment “of late,” perhaps an acknowledgment of the growing private sector optimism after Republicans took control of Washington.

The Fed last hiked rates in December, its second increase in roughly a decade. The central bank had driven down rates to historically low levels after the financial crisis, and kept them down there for years as the U.S. economy struggled to dig out from the resulting recession.

But now, the Fed is looking to return borrowing rates to more normal levels but moving cautiously so as to not upset the ongoing recovery.

The Fed’s decision to stand pat under Trump came after he harshly criticized the Fed on the campaign trail.

Trump claimed the Fed was keeping rates artificially low for the political benefit of then-President Obama, a claim fiercely rejected by the Fed, as officials are strongly protective of the institution’s reputation as politically independent.