INSUBCONTINENT EXCLUSIVE:
In a crucial meeting, the Federal Reserve decided to maintain unchanged interest rates, signaling a pause in prior increases.This decision
indicates a shift from its earlier plan by retaining the federal funds rate at 5.25%-5.5%, the highest since 2001.Based on recent forecasts,
officials expect a quicker rate of cuts.Varied projections on the federal funds rate for 2024 suggest differing evaluations of the economic
changing economic conditions.This contrasts with their prior stance, emphasizing flexibility in policy changes.Fed Holds Rates, Signals
(Photo Internet reproduction)Though inflation has reduced over a year, it remains high
Officials see a more balanced risk to price growth, implying a shift in their inflation outlook.Powell will address this in a press
conference, offering clarity on future Fed actions
Forecasts anticipate lower inflation and marginal economic growth adjustments.By 2025, officials project a notable drop in the federal funds
rate, aligning with anticipated economic conditions.Following a substantial rate hike earlier, timing future rate cuts is crucial
Early reductions might risk inflation surpassing the 2% target.The Fed aims to ensure sustained high rates until confident of inflation
returning to target levels
comments contribute to these expectations, suggesting potential rate cuts as inflation eases.Recent yield declines signal eased financial
conditions, potentially reducing the need for further rate hikes.This shift influences falling mortgage rates, boosting home refinancing and
Businesses benefit from decreased borrowing costs.Powell urges caution against premature conclusions on policy direction, emphasizing the
need for clear evidence of declining price growth before considering easing policies.Officials highlight the importance of concrete evidence
of consensus amidst the current economic situation.
