Federal Reserve officials agreed earlier this month to pause any changes to interest rates as they analyze the effects of President Trump’s tariffs on inflation, unemployment, and the overall economy.

The minutes from the central bank’s early May meeting, released on Wednesday, revealed that “almost all” of the 19 members involved in the Fed’s policy discussions are concerned that “inflation could be more persistent than previously anticipated.”

The officials expressed increased worries about inflation compared to unemployment, which was a significant factor in their decision to maintain the current rates, according to the meeting minutes.

During the May gathering, the Fed opted to keep the benchmark policy rate steady within the 4.25 percent to 4.5 percent range. Following the meeting, Fed Chairman Jerome Powell indicated that the central bank would remain on hold until the Trump administration finalizes its tariff strategies and their economic ramifications become clearer.

Additionally, at the early May meeting, Fed officials highlighted that the volatility observed in bond markets prior to the meeting “warranted monitoring”. They noted that shifts in the US dollar’s status as a safe haven, along with rising Treasury bond yields, “could have lasting effects on the economy.”

This decision to maintain rates came despite Trump’s ongoing calls to lower borrowing costs, asserting on his Truth Social platform that there is “NO INFLATION.” Last year, the Fed had reduced its key rate three times, bringing it down to about 4.3 percent. However, during the May meeting, Federal Reserve economists stated that inflation “remained elevated.”

The dilemma for the Fed arises from Trump’s tariffs, as the duties could potentially increase inflation, which would typically prompt the Fed to raise interest rates, while also slowing the economy and increasing unemployment, which the Fed usually addresses by lowering rates.

The officials “judged that downside risks to employment and … upside risks to inflation had increased, primarily due to the potential consequences of tariff hikes,” the minutes expressed.

Policymakers acknowledged “considerable uncertainty surrounding trade policy developments” and their effects on the economic landscape.

“Overall, (officials) viewed the uncertainty regarding their economic outlooks as unusually high,” the minutes stated.

In the time since the meeting, many officials have reiterated that the Fed may need to remain patient before any further adjustments to interest rates.