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The Federal Reserve held interest rates steady at 4.25% to 4.50%, signaling patience as inflation remains sticky. While the central bank still expects two rate cuts later this year, it also raised its inflation forecast to 2.7%, above its 2% target. Economic growth projections have also been downgraded to 1.7%, reflecting a slower outlook. Fed Chair Jerome Powell pointed to recent Trump administration tariffs as an added layer of economic uncertainty.

This decision shows just how uncertain the Fed’s path forward really is. Cutting rates too soon could rekindle inflation, while waiting too long could squeeze economic growth further. The biggest wildcard? Trade policies and global instability could make inflation harder to control, forcing Powell to hold off on rate cuts longer than markets expect. With stocks, housing, and tech all heavily reliant on interest rate trends, this standoff between inflation and growth is a high-stakes gamble. The Fed’s decision reflects a market still caught between hopes of cheaper money and fears of a slowing economy, meaning volatility could be the only certainty in the months ahead.