Archive · 28 Jan 2026
Fed to Pause Rate Cuts Amid Inflation
The Federal Reserve is meeting to decide on interest rates.
The economy is doing well, but prices are rising, so they are likely to keep interest rates the same.
The Fed's boss, Jerome Powell, is leaving soon, and President Trump wants to replace him.
Trump wants lower interest rates to help the economy, but Powell thinks rates should be set based on data, not politics.
The Fed's independence is important, and if it becomes too influenced by politics, it could make the US dollar less important worldwide.
The next Fed chair could be someone like Rick Rieder, but it's not decided yet.
The Federal Reserve is unlikely to cut interest rates at its January 27-28 meeting due to stable economic conditions and above-target inflation.
Fed Chair Jerome Powell's term ends in May 2026, and President Trump has publicly criticized him and expressed a desire to replace him, raising concerns about Fed independence.
The Fed has kept the federal funds rate unchanged at 3.5% to 3.75% after three consecutive rate cuts aimed at reducing a slowdown in the job market.
Powell's press conference after the meeting is crucial for market reactions, as he is expected to provide forward guidance on the timing and requirements for the next rate cut.
Potential successors for Powell include economic adviser Kevin Hassett, former Fed president Kevin Warsh, and BlackRock Executive Rick Rieder, with Rieder being the current front-runner.
- Who
- Federal Reserve, Jerome Powell, Donald Trump
- What
- Federal Reserve's monetary policy review and potential rate cut pause, political pressure on Fed independence
- When
- Fed meeting January 27-28, Fed chair term ends in May 2026
- Where
- United States
- Why
- Inflation is above target and economic data shows stable conditions, political pressure from President Trump
Trump's View
Powell's View
Interest Rates
Trump's View
Trump wants sharp interest rate cuts to boost the economy.
Powell's View
Powell believes rates should be set based on economic data, not political preferences.
Fed Independence
Trump's View
Trump has publicly criticized Powell and expressed a desire to replace him, raising concerns about Fed independence.
Powell's View
Powell has emphasized the importance of the Fed's independence in setting monetary policy.
- Fed Meeting Dates
- January 27-28
- Current Federal Funds Rate
- 3.5% to 3.75%
- Inflation Target
- 2%
- Current Inflation Status
- Above target (around 3%)
- Expected Fed Action
- Pause on rate cuts
- Fed Chair Term End
- May 2026
- Potential Impact of Fed Dependence Loss
- Could weaken dollar's global supremacy
- Q4 GDP Growth Rate
- 5.4%
- Potential Successors for Powell
- Kevin Hassett, Kevin Warsh, Rick Rieder
- Probability of Rick Rieder as Next Fed Chair
- 49%
Sources
Mint Quick Edit | The US Fed’s rate call this week: White House whim is unlikely to play a role
US Federal Reserve to keep rates unchanged as Powell pivots back to economics
India's economy poised for steady growth, repo rate likely unchanged till 2027
Fed set to pause rate cuts, with no clear path to resuming
US Fed meeting: Will Powell & Co cut rates this week? Here's what to expect
Reserve Bank of India to slash rates by 0.25% next week in this cycle's last cut: Report - Telegraph India
Dollar sinks to four-year low as intervention risk lifts yen
