After a series of rises, the US central bank's policy meeting decided to hold interest rates in their current range. It also predicted a gloomier outlook for growth than that coming from Trump's White House.
The Federal Reserve announced on Wednesday it is to keep its benchmark rate in a range of 2.25 percent to 2.5 percent. The rate influences financial products and services such as mortgages, credit cards and home equity lines of credit.
After raising rates for five consecutive quarters, the Fed indicated it saw no further need to raise them again in the near future.
At their December meeting, the policymakers had predicted there would be two interest rate hikes in 2019, but now they project one rate hike in 2020 and none in 2021.
The Fed also revised down expectations for headline inflation, which includes oil and food, to 1.8 percent for the year, down from the 1.9 percent predicted at their December meeting.
In their statement on Wednesday after a two-day policy meeting, the policymakers said that given sluggish growth and continually mild inflation, the Fed "will be patient as it determines what future adjustments to make" to rates.
Economic growth slowing
Policymakers also saw slowdowns in the US and global economies saying that, while the job market remained strong, "growth of economic activity has slowed from its solid rate in the fourth quarter." They also cited slowdowns in household spending and business fixed investment. Powell said that data arriving since December "suggest that growth is slowing somewhat more than expected."
Fed officials are now forecasting economic growth of 2.1 percent for 2019, lowered from a 2.3 percent projection made at the Fed's December meeting.
This gloomy assessment is also at odds with projections coming from Trump's White House: 3.2 percent for 2019 and 3 percent for 2020.
Treasury bonds still on the books
Officials are also to end the effort to reduce the Fed's massive holdings of government-backed securities: it accumulated $4.5 trillion in Treasury and mortgage-backed securities in an effort to stimulate the economy after the 2008 financial crisis. As a result, more Treasury bonds will be left off the Fed's balance sheet than analysts have expected for some time.
Powell tried to reassure markets, saying "economical fundamentals are still strong," but there were headwinds to growth in Europe and Asia: "We see a situation where the European economy has slowed substantially," he said, adding that China's economy has also weakened.