When’s the next Federal Reserve meeting? What to expect — and how it affects your finances

In this guide

The Federal Reserve meets for fourth two-day rate-setting session of 2025 on Tuesday, June 17, and Wednesday, June 18, 2025.

At the end of its Federal Open Market Committee session on May 7, 2025, the Fed announced holding the federal funds target interest rate steady at a range of 4.25% to 4.50%. It marks the third time the Fed’s paused a rate change since its three back-to-back cuts in September, November and December, dropping the Fed rate by a full percentage point in its continued focus on getting the inflation rate closer to an average 2%.

If all the talk of high interest rates has left you wondering what the Fed’s committee does — or what the Federal Reserve even is, for that matter — here’s our primer on the Federal Reserve and what it means for your future finances.

What is the Federal Reserve — and why does it meet?

The Federal Reserve is the central bank of the United States and the anchor of the country’s financial system and economic health. It’s governed by a federal Board of Governors appointed by the president and confirmed by the U.S. Senate that’s in charge of fulfilling the responsibilities laid out in the Federal Reserve Act of 1913, most important among them to provide the nation with a safe, stable monetary and financial system.

The Federal Reserve Act has been amended a handful of times as the country’s grown and faced economic challenges. Key among them is a 1933 amendment that created the Federal Open Market Committee — or the FOMC — within the Federal Reserve, as well as a 1977 amendment establishing what’s referred to as the Fed’s dual mandate: “to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”

The Federal Open Market Committee, which is made up of the Board of Governors and regional Federal Reserve bank presidents, meets throughout the year to review how the economy is going, analyze risks to employment and inflation and authorize monetary policy, including how the country’s money supply is managed.

At these FOMC meetings, the committee also sets the federal funds target rate cited in its dual mandate. Called the Fed rate, this rate is the benchmark that influences what U.S. banks charge to borrow money and lend money to one another — and the interest rates you’re offered on deposit accounts, personal loans, mortgages and home equity loans.

The Federal Open Market Committee meets next on Tuesday, June 17, and Wednesday, June 18, 2025.

May FOMC meeting recap: Fed pauses rate cuts for third time

At the conclusion of its third rate-setting policy meeting of 2025 on May 7, 2025, the Federal Reserve announced it was leaving the federal funds target interest rate unchanged at 4.25% to 4.50% for a third time after three cuts in 2024: a jumbo half point in September 2024, followed by quarter-point cuts in November and December.

In its post-meeting statement, the Federal Reserve said it was maintaining the target range in its continuing effort to achieve “maximum employment” and tame inflation to 2%.

“The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid,” the Fed said in its statement, noting, “Uncertainty around the economic outlook has increased.”

“In considering the extent and timing of additional adjustments,” the Fed said it would “carefully assess incoming data, the evolving outlook, and the balance of risks.”

After March’s meeting, the Fed updated its rate projections to just two quarter-point cuts in 2025, seeing slower growth and higher inflation ahead.

How the Federal Reserve affects your finances

The federal funds rate — or Fed rate — is the benchmark rate that sets the outlook on the state of the country’s economy, and it affects the interest rates you get on deposit accounts, personal loans, mortgages and other financial products.

Generally, the Fed decreases the federal funds rate to encourage economic activity by making it cheaper for you to borrow money. On the other hand, the Fed raises the federal funds rate when the economy is strong in an attempt to slow borrowing and tame inflation.

Positive impacts of rate cuts

If you’re thinking about taking out a loan or carrying credit card debt, you may see some relief in the months following a rate cut:

In addition to its impact on borrowing, Fed rate cuts tend to have a positive impact on the stock market because:

• Companies can borrow money more cheaply to grow their businesses

• Lower savings APYs often encourage investors to move money from cash into stocks

• Dividend-paying stocks from stable companies like utilities become more attractive as an alternative to high-yield savings

Negative impacts of the rate cut

If you rely on passive income from savings products, you’ll likely see these changes following a rate cut:

• High-yield savings accounts (HYSAs) will see rates drop within weeks after a Fed rate cut, though they’ll still offer significantly better returns than traditional savings accounts

• Certificate of deposit (CD) rates for new accounts will decline, though existing CDs maintain their locked-in rates until maturity

• Money market accounts (MMAs) typically adjust rates downward shortly after Fed cuts, since they’re designed to stay competitive with current market conditions

Dig deeper: 5 ways lower rates can affect your wallet

What to expect at the Fed’s next policy meeting: June 17–18, 2025

The Federal Reserve is expected to hold the Fed rate at 4.25% to 4.50% at its next policy meeting on June 17 and June 18, 2025. The CME FedWatch Tool, which measures market expectations for Fed fund rate changes, predicts a more than 98% chance the Fed keeps rates where they are.

Economists are keeping a close eye on inflation and labor reports amid speculation as to timing of future cuts to the Fed rate, with data indicating sticky inflation from a peak of 9.1% in June 2022 to rates that have ranged from 2.5% and 4% since May 2023.

Fresh jobs data released on June 6 from the Bureau of Labor Services showed employers adding 139,000 jobs to payrolls in May, slightly higher than projections yet lower than the revised 147,000 roles added in April. Unemployment held steady at 4.2%.

Consumer price index data released on June 11 showed the annual inflation rate rising to 2.4% in May from 2.3% reported in April. Overall prices rose 0.1% for May after increasing 0.2% in the previous month, with economists warning the larger impacts of tariff policies won’t be clear until later in the year. The producer price index released on June 12 showed a modest rise in wholesale prices by 0.1% from May, bringing up the increase in wholesale prices to 2.6% year over year.

At a conference on May 15, Federal Reserve Chair Jerome Powell warned of future inflation swings, saying, “we may be entering a period of more frequent, and potentially more persistent, supply shocks,” which will prove a “difficult challenge for the economy and for central banks.”

The Powell-led rate-setting panel will announce a rate decision at the conclusion of its meeting on Wednesday, June 18, 2025, at 2 p.m. ET.

🗓️ 2025 FOMC meeting schedule

The 2025 meeting schedule for the FOMC began on January 28, with its next session scheduled for June 17 and June 18, 2025:

• January 28–January 29, 2025

• March 18–March 19, 2025

• May 6–May 7, 2025

• June 17–June 18, 2025

• July 29–July 30, 2025

• September 16–September 17, 2025

• October 28–October 29, 2025

• December 9–December 10, 2025

The Federal Open Market Committee meets eight times a year for two days — typically Tuesdays and Wednesdays — with additional meetings added to the schedule as the economy or financial conditions require. Outcomes of these meetings, including changes to the federal funds target rate, are announced to the public at the conclusion of the FOMC meeting, with meeting minutes released about three weeks later.

🗓️ 2024 FOMC meeting schedule

The 2024 meeting schedule for the FOMC began on January 30, 2024, concluding the year with its final rate-setting session in December:

• January 30–January 31, 2024

• March 19–March 20, 2024

• April 30–May 1, 2024

• June 11–June 12, 2024

• July 30–July 31, 2024

• September 17–September 18, 2024

• November 6–November 7, 2024

• December 17–December 18, 2024

What is the Federal Open Market Committee?

The FOMC is the committee within the Federal Reserve that makes decisions around monetary policy and the open market — the buying and selling of treasury bills and securities that regulate the country’s money supply.

The Federal Open Market Committee is made up of the seven members of the Federal Reserve Board of Governors and five presidents of the 12 Federal Reserve district banks:

• Federal Reserve Bank of Atlanta

• Federal Reserve Bank of Boston

• Federal Reserve Bank of Chicago

• Federal Reserve Bank of Cleveland

• Federal Reserve Bank of Dallas

• Federal Reserve Bank of Kansas City

• Federal Reserve Bank of Minneapolis

• Federal Reserve Bank of New York

• Federal Reserve Bank of Philadelphia

• Federal Reserve Bank of Richmond

• Federal Reserve Bank of San Francisco

• Federal Reserve Bank of St. Louis

These presidents act as bank CEOs responsible for setting, supervising and maintaining the monetary policy of their appointed regions — called districts. Created by the Federal Reserve Act of 1913, districts within the Federal Reserve System work together to manage the country’s money supply and how commercial banks are funded.

Who attends the FOMC meetings?

The seven members of the Federal Reserve’s Board of Governors and all 12 regional Federal Reserve bank presidents are welcome to attend the meetings and participate in discussions, but only Federal Open Market Committee members can vote on monetary policy.

Voting FOMC members always include the president of the Federal Reserve Bank of New York and one each from the following four bank groups, based on a rotating schedule:

• Boston, Philadelphia and Richmond, Va.

• Cleveland and Chicago

• Atlanta, St. Louis and Dallas

• Minneapolis, Kansas City, Mo. and San Francisco

2025 FOMC members

• Jerome H. Powell, Board of Governors, Chair

• John C. Williams, New York, Vice Chair

• Michael S. Barr, Board of Governors

• Michelle W. Bowman, Board of Governors

• Lisa D. Cook, Board of Governors

• Philip N. Jefferson, Board of Governors

• Adriana D. Kugler, Board of Governors

• Christopher J. Waller, Board of Governors

• Austan D. Goolsbee​, Chicago

• Susan M. Collins, ​​Boston

• Alberto G. Musalem, ​St. Louis

• ​​Jeffrey R. Schmid​​, Kansas City

Other stories in our Fed rate series

Frequently asked questions: The Fed, the FOMC and your money

Learn more about the Federal Reserve, its members and rates that affect your finances. And take a look at our growing library of personal finance guides that can help you save money, earn money and grow your wealth.

What does the Federal Reserve do?

The Federal Reserve is the central bank of the U.S. that sets monetary policy and regulates the financial system to support a healthy economy for Americans and businesses. Created by Congress in December 1913, It has a mandate to increase employment and stabilize prices in order to keep inflation in check.

Among its main responsibilities are determining benchmark interest rates that affect the way consumers and businesses earn and borrow money, moderating the money available for banks to borrow and lend among themselves and regulating the open market that allows buyers and sellers to trade goods and services.

Its decisions influence how much money and credit is available to Americans and businesses, which affects how we buy homes and borrow money, grow our savings and retirement funds and take on new employment within a healthy job market.

What is the current federal funds rate?

The current federal funds target interest rate is 4.25% to 4.50%. The Federal Reserve’s Federal Open Market Committee meets eight times a year to set this benchmark, announcing any changes to the public at the conclusion of its meeting.

At its last rate-setting policy meeting, on May 7, 2025, the Fed kept its benchmark funds rate unchanged for a second time since September 2024, continuing a policy shift that focuses on improving borrowing costs, easing the job market and warding off economic slowdown.

What is the inflation rate?

The annual inflation rate is a measurement that reflects how quickly the prices of goods and services have increased over a year, expressed as a percentage. It’s important because inflation affects many aspects of the economy, from decreasing the purchasing power of the dollars in your wallet, to increasing the interest rates you pay to borrow money, to increasing the prices you pay on food, gas, housing, electricity and other basic needs.

The Federal Reserve is focused on keeping the inflation rate to an average 2% — a rate it’s determined as ideal for keeping employment high and prices low. A 2% inflation rate means that the goods and services you paid $1 for a year ago would now cost you 2% more — or $1.02.

See how inflation works with the U.S. Bureau of Labor Statistics CPI Inflation Calculator, which bases its calculations on the Consumer Price Index, a widely used indicator for inflation.

How long are Federal Reserve terms?

Members of the Federal Reserve Board of Governors are appointed by the U.S. president and confirmed by the Senate for terms of 14 years. The Board of Governors chair and vice chair serve shorter terms of four years.

Tradition holds that members of the Federal Reserve’s Federal Open Market Committee elect the Board of Governors chair as FOMC chair and the president of the Federal Reserve Bank of New York as FOMC vice chair.

Sources

• Federal Reserve Act, Federal Reserve. Accessed April 29, 2024.

• Federal Open Market Committee, Federal Reserve. Accessed December 18, 2024.

• The Dual Mandate and the Balance of Risks, Federal Reserve. Accessed April 29, 2024.

• The History and Future of the Federal Reserve’s 2 Percent Target Rate of Inflation, Council on Foreign Relations. Accessed April 29, 2024.

• Employment Situation Summary, U.S. Bureau of Labor Statistics. Accessed June 6, 2025.

• Consumer Price Index Summary, U.S. Bureau of Labor and Statistics. Accessed June 11, 2025.

• Producer Price Index News Release summary, U.S. Bureau of Labor and Statistics. Accessed June 12, 2025.

• CME FedWatch Tool, CME Group. Accessed June 11, 2025.

About the writer

Kelly Suzan Waggoner is personal finance editor at AOL. Before joining AOL, Kelly was managing editor at Bankrate and editor-in-chief at Finder, where she led a team focused on helping people to make unfamiliar financial decisions around banking, lending, credit cards, investments and more. Kelly’s expertise has been featured in Nasdaq, Lifehacker and other publications. Today, she’s dedicated to empowering those planning for, newly entering or fully enjoying retirement to get the most out of their finances — whether that’s saving money, managing debt, maximizing rewards or growing their wealth.

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