Federal Reserve Defies Trump, Raises Interest Rate Amid Booming Economy

The Federal Reserve has voted unanimously to raise its benchmark interest rate to 3.75% - 4%, marking the first increase since 2023. This decision comes despite President Donald Trump's repeated calls for lower interest rates.

Federal Reserve Board Chairman Kevin Warsh explained that economic activity continues to expand, with domestic spending remaining strong and job gains keeping pace with the workforce. However, inflation remains elevated, and the interest rate increase is intended to support a timely return to the Fed's 2% goal and aid overall price stability.

In response to the decision, President Trump released a statement insisting that Americans' interest rate should be no higher than 1%. He cited the country's booming economy and strong credit ratings as reasons for his proposal.