\n<\/p>\n
WASHINGTON — <\/span>After two weeks of intense political<\/a> and legal scrutiny, the Federal Reserve will seek to make this week’s meeting about interest rates as straightforward and uneventful as possible, though President Donald Trump probably still won’t like the result. <\/p>\n The central bank’s interest rate-setting committee is almost certain to keep its key short-term rate unchanged at about 3.6%, after three straight quarter-point cuts last year<\/a>. Fed Chair Jerome Powell said after December’s meeting that they were \u201cwell positioned to wait to see how the economy evolves\u201d before making any further moves. <\/p>\n When the Fed lowers its short-term rate, it can over time influence other borrowing costs for things like mortgages, auto loans and business borrowing, though those rates are also affected by market forces. <\/p>\n This week’s meeting \u2014 one of eight the Fed holds each year \u2014 will be overshadowed by the bombshell revelation earlier this month that the Justice Department has subpoenaed the Fed<\/a> as part of a criminal investigation into testimony Powell gave last June about a $2.5 billion building renovation<\/a>. It’s the first time a sitting Fed chair has been investigated, and prompted an unusually public rebuke from Powell.<\/p>\n Now, Powell will have to shift from a dispute with the White House to emphasizing that the Fed’s decisions around interest rates are driven by economic concerns<\/a>, not politics. Powell said Jan. 11<\/a> that the subpoenas were \u201cpretexts\u201d to punish the Fed for not cutting rates as sharply as Trump wants. <\/p>\n Powell will be “under even more pressure to underscore, \u2018everything we\u2019re doing here … is all about the economics,\u2019\u201d said Claudia Sahm, a former Fed economist and chief economist at New Century Advisors. “‘We didn\u2019t think about the politics.’\u201d <\/p>\n Michael Gapen, chief U.S. economist at Morgan Stanley and also a former Fed staffer, said that despite the scrutiny, the Fed can be expected to consider its interest rate policies like it always does. <\/p>\n \u201cThe meetings have a regular flow to them,\u201d he said. “There are presentations that are made, there are discussions that have to be had. … Some of these other broader-based attacks on the Fed don’t really come up.” <\/p>\n Not long after the Justice Department’s subpoenas, the Supreme Court last week considered whether Trump can fire Fed governor Lisa Cook<\/a> over allegations of mortgage fraud, which she denies<\/a>. No president has fired a governor in the Fed’s 112-year history. During an oral argument<\/a>, the justices appeared to be leaning toward allowing her to stay in her job until the case is resolved. <\/p>\n Other Fed officials have also signaled the central bank is likely to keep rates unchanged at their two-day meeting that ends Wednesday. The Fed’s three rate cuts last year were intended to bolster the economy after hiring slowed sharply over the summer and fall in the wake of Trump’s April tariffs on dozens of countries. <\/p>\n Yet the unemployment rate ticked lower<\/a> in December, after picking up for much of last year, and there are other signs the job market may be stabilizing. The number of people seeking unemployment benefits has stayed historically low, a sign layoffs haven’t spiked. <\/p>\n