economy

January 28, 2026

Trump wants lower borrowing costs—but a Fed rate cut may be months away

Borrowing costs are likely to stay higher for longer, with only gradual relief expected through 2026.

Trump wants lower borrowing costs—but a Fed rate cut may be months away

TL;DR

  • The Federal Reserve is anticipated to announce no change to its benchmark interest rate.
  • President Donald Trump has consistently urged the Fed to cut interest rates.
  • Market expectations, tracked by CME FedWatch, indicate a high probability the Fed will maintain its current rate.
  • Ongoing inflation, with measures above the Fed's 2% target, is a key reason for the expected hold.
  • The resilience of the labor market and broader economy also contributes to the Fed's cautious stance.
  • Tariffs are mentioned as a factor that can increase business costs and complicate economic planning.
  • The Fed's dual mandate includes controlling inflation and supporting the job market.
  • An ongoing Justice Department investigation involving the Federal Reserve and grand jury subpoenas adds complexity.
  • Fed Chair Jerome Powell has warned that political pressure could undermine the central bank's independence.

Continue reading the original article

Made withNostr