U.S. Federal Reserve Chair Jerome Powell said on Wednesday that President Donald Trump's tariff increases would delay progress in bringing down inflation this year, but the Fed's base case is that tariff-related price impacts will be transitory,

WASHINGTON (AP) — The Federal Reserve kept its benchmark interest rate unchanged Wednesday and signaled that it still expects to cut rates twice this year even as it sees inflation staying stubbornly elevated.

Powell attributed some of this uncertainty to Trump's tariff policies, suggesting they could lead to higher inflation, at least temporarily. The Fed still anticipates two quarter-percentage-point rate cuts by year's end, primarily due to weakened economic growth offsetting inflationary pressures.