Federal Reserve Chairman Jerome Powell made it clear this week that the central bank is not rushing into any decisions regarding interest rates. In testimony before Congress, Powell emphasized that while the U.S. economy remains strong and employment stable, inflation still runs above the Fed’s 2% target. One major concern is the uncertain impact of tariffs introduced under President Donald Trump.

Powell noted that changes in trade policy, like tariffs, can push prices up. However, the full effect of these policies is still unknown. He said that before considering any changes to interest rates, the Fed needs more time and data to understand the economic consequences. He reaffirmed that the Fed is in no hurry and will carefully monitor the situation.

Despite sharp criticism from Trump, Powell insisted that the central bank is unaffected by political pressure. “We’re just doing our jobs,” he said, underlining the Fed’s independence. Trump, who has often attacked Powell publicly, recently renewed his criticism on social media. Powell, however, stayed firm, saying that decisions will be based solely on economic indicators.

Looking at the inflation data, Powell mentioned that it is expected to edge slightly higher, with the core inflation rate possibly reaching 2.6% in May. Although these are modest increases, Powell emphasized that the Fed’s job is to prevent temporary price rises from turning into long-term inflation problems. He stressed that maintaining price stability is essential for sustainable job growth and a healthy economy.

Last week, the Fed decided to keep interest rates unchanged. But internal projections showed differing views among officials, with some expecting up to three rate cuts later this year if inflation eases. Nonetheless, Powell repeated that any decision will depend on upcoming data.