The Fed maintains interest rates steady, estimates slower growth and higher inflation

The Federal Reserve left its interest rates unchanged Wednesday as the market expected, but warned of greater "uncertainty" in the domestic economy and lowered its growth forecasts and raised inflation forecasts slightly.

Two months after Donald Trump's return to the White House, the Fed kept its rates in a range of 4.25%-4.50%.

But "uncertainty about the economic outlook increased," according to the central bank's statement, which maintains its expectation of making two rate cuts in the year. In the same vein as that statement, Fed Chairman Jerome Powell told reporters that uncertainty is "unusually elevated" at present.

Powell added at a press conference that "policy does not follow a preset course" and said officials will adjust their stance as the world's largest economy evolves.

In this context, the Fed lowered its growth forecast in 2025 to 1.7% and raised its inflation forecast to 2.7%.

It had previously forecast 2.7% growth this year and 2.5% inflation. And after two days of meetings, the Fed is showing less confidence about the health of the U.S. economy.

For unemployment, there was also a forecast correction, from 4.3% to 4.4%. Since the Fed's last meeting in January, which also held rates, the outlook has changed a lot.

Specialists expect a pickup in inflation, which could in turn drive a rate hike. High rates make credit more expensive and therefore reduce consumption and investment, which puts downward pressure on prices. Economists also expect the economy to cool, which puts pressure in the other direction: lowering rates to boost it.

Trump has insisted on an interest rate cut.

The status quo "is the most appropriate policy at this point since we don't really know how far tariffs will go and for how long," former Boston Fed President Eric Rosengren told AFP ahead of the outcome of Tuesday and Wednesday's meeting.