Federal Reserve expected to hold interest rates steady, defying Trump

Source: ABC News

The Federal Reserve on Wednesday is set to announce its latest decision on the level of interest rates, marking its first rate move since news surfaced of a federal criminal investigation into Fed Chair Jerome Powell.

The investigation ratcheted up an extraordinary clash between the nation's top central banker and the White House, which has urged the Fed to significantly reduce interest rates.

The central bank is widely expected to defy President Donald Trump's wishes, opting instead to hold interest rates steady. The anticipated move would end a string of three consecutive quarter-point rate cuts, aligning with a cautious approach outlined by Powell last month, before reports of the investigation into his conduct.

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The federal probe appears to center on Powell's testimony to Congress last year about cost overruns in a multi-billion-dollar office renovation project. Powell, who was appointed by Trump in 2017, issued a rare video message earlier this month rebuking the investigation as a politically motivated effort to influence the Fed's interest rate policy.

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