Fed, the US central bank, freezes interest rates at 5.25% as federal deficit heightens global risk

The Federal Reserve (Fed) decided to keep its benchmark interest rate unchanged in the range of 5.00% to 5.25% annually.

The agency's chairman, Kevin Warsh, warned that core inflation, which measures prices excluding the volatility of food and energy, remains "stubbornly stuck" at 3.4% annually for the services sector.

Meanwhile, the Congressional Budget Office sounded the alarm by raising its projection of the US federal deficit for 2026 to a colossal $1.83 trillion, driven by interest payments on public debt that already absorbs 16% of the entire federal budget.