On The Money: Fed opens door to rate cuts under pressure from Trump | Lawmakers, White House fail to reach budget deal | Democrats take aim at Trump policies with $1T spending bill | Senate sets hearing on Facebook’s cryptocurrency

Happy Wednesday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL–Fed opens door to rate cuts under pressure from Trump: The Federal Reserve announced Wednesday that it would hold interest rates steady for the next month but suggested it could soon cut rates if inflation remains low and global headwinds strain the U.S. economy.

The Fed was widely expected to keep interest rates even in June while opening the door to a cut as soon as July. But the bank faced intense pressure from President Trump and Wall Street to lower rates this month.{mosads}

While Fed officials expressed concerns about the rising costs of trade tensions and slowing global growth, the central bank said Wednesday that the economy did not yet need stimulus from cheaper money. I explain why here.

• All but one of the 12 voting members of the Federal Open Markets Committee (FOMC), which sets interest rates, supported holding rates steady.
• But seven FOMC officials projected the Fed to cut rates twice by the end of 2019, while one expected one cut. Of the nine remaining FOMC members, eight expected the Fed to hold rates steady through the year, while one member projected one more rate hike.
• “There was not much support for cutting rates now, at this meeting,” Federal Reserve Chairman Jerome Powell said Wednesday. He noted that of the FOMC members that projected cuts, “all of those but apparently one felt that it would be better to see more before moving.“

The background: The central bank’s shift toward a potential cut comes as Powell and the bank face intense scrutiny and unprecedented political pressure.

• The U.S. economy appears to be slowing from a burst of growth in 2018, even as unemployment remains near record lows. The rising costs of Trump’s trade war with China, inconsistent economic data and slowing growth abroad also pose threats to U.S. growth.
• Advocates for a rate cut also cite the persistence of inflation below the Fed’s target of 2 percent, measured by the personal consumption expenditures (PCE) price index minus food and energy costs.

“Our continued patient stance seemed appropriate, and the committee saw no strong case for adjusting our policy rate,” Powell said. “In the weeks since our last meeting, those crosscurrents have reemerged.“

ON TAP TOMORROW

• The House Financial Services Committee holds a hearing on increasing corporate boardroom diversity, 10 a.m.
• The Senate Banking Committee holds a hearing entitled “Outside Perspectives on the Collection of Beneficial Ownership Information

LEADING THE DAY

Congressional leaders, White House officials fail to reach budget deal: Congressional leaders from both parties and senior White House officials emerged from a meeting in Speaker Nancy Pelosi’s (D-Calif.) Wednesday afternoon without a deal on raising spending caps and the debt limit.

Congress and the White House have a few more months to go before the new fiscal year starts on Oct. 1, but lawmakers are eager to take the prospect of another government shutdown off the table sooner rather than later.

Treasury Secretary Steven Mnuchin, who attended Wednesday’s meeting, said after the talks ended that Pelosi had reversed her earlier stance that the debt ceiling would not be raised without a spending caps deal. The Hill’s Alexander Bolton and Niv Elis tell us where talks stand.

Meanwhile, Democrats muscled through a nearly $1 trillion spending bill Wednesday that attempts to block Trump’s policies on climate change, abortion and immigration, underscoring Pelosi’s argument that the House can work as a check on the administration.

• The legislation includes the two largest government spending bills — one for Defense and one covering Labor, Health and Human Services and Education. It also covers funding bills for foreign operations and energy and water.

• The measure takes aim at a slew of Trump’s funding goals, starting with a rejection of his budget request, which proposed deep cuts to the State Department, cuts to the National Institutes of Health, the elimination of advanced energy research and a massive increase in defense spending.

GOOD TO KNOW

• The Senate Banking Committee announced Wednesday it will hold a hearing on Facebook’s plans to create a new cryptocurrency-based payments system.

• U.S. Trade Representative Robert Lighthizer said Wednesday that he plans to speak with his Chinese counterpart by phone before the two countries resume trade talks.

• The Senate Appropriations Committee approved legislation on Wednesday that would give President Trump more than $4.5 billion in additional spending for the U.S.-Mexico border.

• The liberal group Stand Up America announced on Wednesday that it’s launching a new campaign to pressure House Ways and Means Committee Chairman Richard Neal (D-Mass.) to immediately file a lawsuit over the Treasury Department’s failure to comply with his requests for President Trump’s tax returns.

• Google’s parent company on Wednesday rejected a call from its own shareholders to break up the internet search giant over concerns that it has grown too large and unmanageable.

• U.S. Steel will idle two plants despite Trump’s tariffs meant to revive the American metal industry.

ODDS AND ENDS

• Astrologists — and Libras in particular — are lashing out at Facebook for naming its new cryptocurrency after the zodiac sign.

• Two companies petitioned for Trump’s solar tariffs are now out of business, according to Quartz.