The Federal Reserve this afternoon announced that it will not be raising interest rates as the year draws to a close. The Fed’s Open Market Committee wrapped up a two-day meeting by issuing a statement that indicated a pause in interest rate increases is called for with inflation seeming to be fairly well controlled, although still above the Fed’s target of 2%.
Fed Chairman Jerome Powell was scheduled to speak at a news conference this afternoon and there were indications he might hint at possible interest rate cuts going into effect around the middle of 2024.
In its announcement of the interest rate pause, the Fed said, in part: “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.”
The Fed’s Open Market Committee said that it decided to maintain the target range for the federal funds rate at 5-1/4% to 5-1/2%. The committee said it will continue to assess additional information and its implications for monetary policy in determining the extent of any additional policy firming that may be appropriate to return inflation to 2%.
The Open Market Committee said that its assessments of economic conditions when deciding how to proceed with interest rates will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.