The Fed, helmed by Chair Jerome Powell, is expected to hold rates steady this month despite pressure from President Donald Trump to make cuts.

"No one holds these ... rate paths with a great deal of conviction, and everyone would agree that they're all going to be data-dependent," Powell said.

When the Fed reduces its rate, it often — though not always — leads to lower costs for consumer and business borrowing, including for mortgages, auto loans, and credit cards. Yet financial markets also influence the level of longer-term rates and can keep them elevated even if the Fed reduces the shorter-term rate it controls.