• The US Federal Reserve has decided to pause interest rate cuts.
• Concerns arise over inflation and unemployment due to Trump's tariff policies.
• Fed officials emphasize the uncertainty surrounding economic conditions.
• The current key lending rate remains between 4.25% and 4.50%.
• Market analysts expect no rate cuts until there is more economic clarity.

On May 7, the US Federal Reserve announced a pause in rate cuts, maintaining its key lending rate at between 4.25% and 4.50%. This decision was unanimous and reflects increasing concerns about the economic consequences of President Donald Trump's tariff policies, which heighten risks related to inflation and unemployment, according to Channel News Asia and Le Monde.

Fed Chair Jerome Powell noted a "great deal of uncertainty" regarding the implications of ongoing tariff policies. He stated that the Fed could find itself in a challenging position where inflation control and job growth objectives might conflict. The tariff-induced complications pose significant challenges for the central bank's dual mandate, as the economic landscape remains unpredictable following Trump's implementation of new tariffs, highlighted by India Times and Channel News Asia.

Public criticism from Trump regarding the Fed's policy responses added additional complexity, with the president continuously calling for rate cuts to stimulate growth. Powell emphasized that actual economic data, rather than political pressure, will guide the Fed's decisions, reflecting an adherence to their mandate despite external pressures, as reported by Le Monde and Channel News Asia.

Market analysts indicate that the uncertainty stemming from Trump’s tariffs will likely postpone any potential rate cuts. Many predict it will not be until September that the Federal Reserve might consider easing its monetary policies. This sentiment was echoed by economists assessing the volatile economic indicators stemming from the tariff implementation and the effects of trade negotiations, including insights from India Times, Channel News Asia, and Le Monde.