Federal Reserve Chair Jerome Powell’s focus on inflation suggests that the Fed will likely keep its benchmark interest rate unchanged at about 4.3% in the coming months.
The Federal Reserve has again kept its interest rate at about 4.3%, as the central bank evaluates the impact of the Trump administration’s policies on the economy.
Federal Reserve Chair Jerome Powell said the economy remains mostly healthy despite “elevated uncertainty.”
The Federal Reserve is prepared to keep its key interest rate unchanged for now as inflation remains elevated and the job market is solid, Chair Jerome Powell said Tuesday.
The Federal Reserve left its benchmark interest rate unchanged Wednesday after cutting it three times in a row last year, a sign of a more cautious approach as the Fed seeks to gauge where inflation is headed.
Fed officials have clearly signaled they expect to skip a rate hike, at least in January, to evaluate the job market and economy.
While sales of previously occupied U.S. homes rose in November for the second straight month, the housing market was on track to end 2024 as its worst year for sales since 1995.
New quarterly projections suggest that consumers may not enjoy much lower rates next year for mortgages, auto loans, credit cards and other forms of borrowing.
Americans hoping for lower borrowing costs for homes, credit cards and cars may be disappointed after this week’s Federal Reserve meeting.
Even if inflation continued declining to the Fed’s 2% target, officials said, “it would likely be appropriate to move gradually” in lowering rates, according to minutes of the November 6-7 meeting.
Federal Reserve Bank of Chicago President Austan Goolsbee said he supports additional interest rate cuts—although he also said it’s difficult to determine the ideal rate.
The U.S. economy is strong and should continue to grow next year, Fifth Third Bank Chief Investment Strategist Tom Jalics said at IBJ’s 2025 Economic Forecast breakfast Thursday.
The rate cut signals that Fed officials are paying more attention to warnings in the economy, including the slowing job market.
The ongoing decline in inflation makes it even more likely that the Federal Reserve will cut its key benchmark rate further in the coming months.
The rate cut, the Fed’s first in more than four years, reflects its new focus on bolstering the job market, which has shown clear signs of slowing.
At issue is how fast the Fed wants to lower interest rates to a point where they’re no longer acting as a brake on the economy—nor as an accelerant. Where that so-called “neutral” level falls isn’t clear.
Collectively, Friday’s figures depict a job market slowing under the pressure of high interest rates but still growing.
Federal Reserve Chair Jerome Powell emphasized that inflation, after the worst price spike in four decades inflicted pain on millions of households, appears largely under control.
Further guidance on the Fed’s next steps is expected when Chair Jerome Powell gives a highly anticipated speech Friday morning at the annual symposium of central bankers in Jackson Hole, Wyoming.
Federal Reserve Chair Jerome Powell said Wednesday that the upcoming elections would have no influence on the Fed’s decisions.
