Fed Holds Rates Steady, Faces Internal Split

The Federal Reserve has kept its key interest rate unchanged for the fifth consecutive meeting, maintaining the target range at 4.25% to 4.5% amid persistent inflation and economic uncertainty linked to President Trump's tariffs. Pressure from President Trump and the real estate industry for a rate cut has intensified, as high mortgage rates have contributed to a 13-year low in spring home sales and increased affordability concerns. For the first time since 1993, two Trump-appointed Fed board members dissented, voting in favor of a rate cut and signaling growing internal division. Chair Jerome Powell stated the Fed requires more data to judge whether recent inflation increases driven by tariffs are temporary. While some borrowing rates have shifted, most consumers continue to feel the impact of high interest rates. Market participants are closely watching for a potential rate cut as early as September.