Fed Rate Decision Looms as Trump Demands Low Interest Rates

The Federal Reserve is set to make a decision on interest rates that could put it at odds with the Trump White House. The Fed's Open Market Committee, led by Chair Kevin Warsh, will meet to discuss whether to raise or lower the policy rate.

Financial markets have priced in a 25-basis point cut, but this would be a departure from the market's expectation of a rate hike. If the Fed does as expected and raises rates, it would be on a collision course with Trump, who has repeatedly called for low interest rates.

Warsh is caught between pleasing the White House and doing what he believes is best for the economy. He has previously stated that price stability is a firm target, but now faces pressure from investors to raise rates due to rising inflation.