Morning Business Report: Federal Reserve holds interest rates as markets and consumers watch next moves

The Federal Reserve has entered a new holding pattern on interest rates, signaling it is in no rush to begin cutting borrowing costs anytime soon.

(LILAMAX) – The Federal Reserve has entered a new holding pattern on interest rates, signaling it is in no rush to begin cutting borrowing costs anytime soon.

Federal Reserve Chair Jerome Powell said recent economic data has painted a somewhat brighter picture than at the central bank’s previous meeting. Powell pointed to stronger economic growth and early signs that the job market may be stabilizing, reinforcing the Fed’s decision to keep rates unchanged as it continues to monitor inflation and labor trends.

Markets reacted modestly to the Fed’s announcement. Stocks edged higher Wednesday, with the S&P 500 crossing the 7,000 mark for the first time, reflecting investor confidence despite continued uncertainty around future rate cuts.

Meanwhile, President Donald Trump highlighted a new financial initiative during a U.S. Treasury event Wednesday, promoting what he called “Trump Accounts.” The program is designed to give every newborn American child a financial stake in the future.

Trump said parents and contributors — including relatives and employers — can add up to $5,000 per year to a child’s account. Bank of America and JPMorgan Chase announced they will match the federal government’s $1,000 contribution for eligible employees who establish Trump Accounts.

In corporate news, General Motors is quietly shifting toward a subscription-based business model. The automaker says its in-vehicle technology services generated nearly $2 billion last year, driven by subscriptions for safety features, in-car internet access, and hands-free driver assistance.

Consumer spending is also in focus as major events like the Winter Olympics, Grammy Awards, and Super Bowl draw closer. A new survey from CNET shows larger screens and smart features are the top reasons shoppers consider buying a new television. However, 42 percent of consumers say they are willing to sacrifice features to stay within budget.

CNET reports that now may be the best time to buy, as retailers are heavily discounting 2025 TV models.