The Federal Reserve has decided to keep the benchmark interest rate unchanged due to ongoing inflation concerns. However, policymakers are predicting three rate cuts later in 2024 once inflation starts moving towards the bank's 2% goal.
Federal Reserve officials said they are leaving the central bank's benchmark interest rate unchanged, a decision widely expected by economists after recent inflation data showed that prices are still increasing at a faster pace than the Fed would like. Even so, most officials are predicting three rate cuts later in 2024.
Policymakers on Wednesday said that while inflation is coming down, it 'does not expect it will be appropriate' to cut rates until the bank is confident inflation is moving toward its 2% goal.The Fed on Wednesday said it is maintaining the federal funds rate in a range of 5.25% to 5.5%. Still, most members of the Federal Open Market Committee are still projecting three rate cuts later in 2024, matching the bank's earlier forecast for the number of rate reductions this year, according to the Fed's Summary of Economic Conditions.Many inflation-weary consumers are eager for a reprieve from high borrowing costs, the result of the Fed's 11 interest rate hikes starting in early 2022. While inflation is rapidly cooling, it is hovering at slightly above 3% on an annual basis, higher than the Fed's goal of 2%. That's led the Fed to pause any move to ease rates, with Chair Jerome Powell previously saying that the central bank doesn't want to cut prematurely and risk a flare-up of inflatio
Federal Reserve Interest Rate Inflation Rate Cuts Economy
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