Washington DC - The Federal Reserve kept interest rates unchanged for a fifth consecutive policy meeting Wednesday, defying strong political pressure from President Donald Trump to slash borrowing costs – although divisions emerged among policymakers.

The central bank kept the benchmark lending rate at a range between 4.25% and 4.50%, saying "recent indicators suggest that growth of economic activity moderated in the first half of the year" despite distortions from trade swings as businesses tried to avoid Trump's wide-ranging tariffs.

"Uncertainty about the economic outlook remains elevated," as did inflation, the Fed added in a statement at the end of its two-day policy gathering.

The decision came with two rare dissents from Fed Governors Christopher Waller and Michelle Bowman, who had previously signaled openness to a July rate cut.

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They preferred to lower rates by 25 basis points instead, the Fed said.

While potential divisions among the Fed's rate-setting committee were expected by financial markets, analysts note this marks the first time since 1993 that there have been dissents by two governors.

The Fed decision comes amid a flurry of data releases this week, including a report showing the world's biggest economy returned to growth in the second quarter.

The GDP data was largely influenced by a pullback in imports after businesses stocked up earlier this year to avoid incoming levies imposed by Trump.