The Federal Open Market Committee today announced that it would maintain the target range for the federal funds rate at 5.25% – 5.5%.
In its statement, the FOMC said that “recent indicators suggest that growth of economic activity has slowed from its strong pace in the third quarter. Job gains have moderated since earlier in the year but remain strong, and the unemployment rate has remained low. Inflation has eased over the past year but remains elevated.”
Regarding rate cuts going forward, Federal Reserve Chairman Jerome Powell stated that “the question of when it will become appropriate to begin dialing back the amount of policy restraint in place that begins to come into view, and is clearly a discussion topic of discussion out in the world and also of discussion for us at our meeting reading today.” However, he also acknowledged that that “while participants do not view it as likely to be appropriate to raise interest rates further, neither do they want to take the possibility off the table.”
The Summary of Economic Projects’ dot plots were revised lower for the first time since June 2020. The dots indicate 75 basis points (bp) of easing in 2024 and 100 bps of rate cuts in 2025.
Read the Federal Reserve statement.