The main bank in the US, the Federal Reserve, did not change interest rates this week. They did not listen to the president, who wanted lower costs for borrowing money. They also said that it is more likely that more people will lose their jobs and prices will increase. This makes the situation difficult for the bank.

The central bank did not change its interest rate for the third time. They lowered it three times at the end of last year. Some people who study the economy think the bank will lower rates this year. But new taxes on goods from other countries have made the economy hard to know what will happen.

After the plan was shared, the leader, Jerome Powell, said that the taxes have made people and companies feel less sure, but they haven't really hurt the economy yet. He said that now, it's too hard to know what the central bank should do about the taxes because things are not clear enough.

Powell said that if the big planned taxes on imported goods stay high, prices could go up, the economy could grow more slowly, and more people could lose their jobs. He also said these effects might not last long, or they could continue for a while.

It's not common for the central bank to worry about prices going up and more people losing their jobs at the same time. Usually, prices go up when people spend a lot and companies raise prices because they can't make enough things. This happened after the pandemic. But when people lose jobs, the economy is weaker, so people spend less, and prices don't go up as much.

When many people lose their jobs and prices go up quickly, it is sometimes called "stagflation". This worries central bankers because it is hard to solve both problems at the same time. This happened for a long time in the 1970s because of oil problems and money problems.

But most economists say Trump's taxes on imports could make things cost more and cause people to lose their jobs. This is because things from other countries become more expensive, and companies might fire workers when their costs go up.

The Fed wants to keep prices from going up too fast and help people have jobs.

When prices rise a lot, the Fed usually makes it more expensive to borrow money. This makes people spend less, which helps slow down the price increases. If many people lose their jobs, the Fed usually makes it cheaper to borrow money. This helps people spend more and helps the economy get bigger.

At the start of the year, people thought the Fed would lower interest rates a few times because prices were not going up as quickly. Some experts also think the Fed should lower rates to help the economy and jobs because of new taxes on things brought into the country. But Powell said clearly that because the economy is doing well now, the Fed can wait.

A few months ago, many experts thought the economy would slow down gently. They believed prices would stop rising so quickly and go back to the goal of 2%. Also, they thought lots of people would still have jobs because the economy was strong.

But on Wednesday, Powell said that would probably not happen.

Powell said that if the taxes on goods from other countries are put in place at that high price, they will not reach their goals in the next year.

Powell said the Fed's next step will depend on whether prices go up a lot or if many people lose their jobs.

He said they will wait to see what happens. After that, they will decide if they will make prices lower or keep them the same.

A money expert named Krishna Guha said the US central bank thinks the economy is strong. This means they will probably not lower interest rates very soon. He thinks they will wait longer than June, and many other experts agree they might wait until September.

In April, Trump said he would add new taxes on goods from about 60 countries that the U.S. trades with. He stopped most of these taxes for 90 days, but not the taxes on goods from China. The government has put a 145% tax on goods from China. The U.S. and China will have their first important talks since Trump started this trade fight. These talks will be this weekend in Switzerland.

The main bank is being careful. This might cause more problems between the bank and Mr. Trump's government. Last Sunday, Mr. Trump said on TV that the bank should lower interest rates again. Mr. Trump had said he would try to fire the head of the bank, but he stopped saying that. However, he might think about firing the head again if the country's economy gets bad soon.

When someone asked if Trump's requests for lower rates changed anything, Powell said, "It doesn't change how we do our job. We will always only think about the economy, what we think will happen, and the possible problems."

If the Fed lowers interest rates, it could make borrowing money cheaper for things like homes, cars, and credit cards, but this is not sure.

A big problem for the Fed is how taxes on imports will change prices. Most experts think these taxes will make prices go up, but they don't know how much or for how long. Usually, these taxes make prices go up just once, not all the time.

Right now, the U.S. economy is doing quite well. Prices are not rising as fast as they were in 2022. People are buying things, maybe because they want to get cars before the price goes up. Companies are still hiring people, so many people have jobs.

But it looks like prices will go up more in the next few months. Companies that make and sell things are paying more for the things they need. And a study found that about half of these companies think they will ask customers to pay more because of higher taxes on goods from other countries.