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Fed Keeps Pace Slow on a Bumpy Road to Lower Rates
The Federal Reserve left the target for its policy rate, the federal funds rate, in the 5.25% to 5.5% range at its latest meeting. However, it did revise up its projections for gross domestic product (GDP) growth and core inflation for this year, and reduced its projections for the pace of rate cuts over the next two years. The result is that the Fed is still expecting a cumulative 75 basis points (0.75%) in rate cuts in 2024, but a slower path of rate cuts in 2025 and 2026. In addition, it signaled that the federal funds rate may not fall to 2.5% in the longer run as previously expected. The seemingly contradictory ... (full story)