The Federal Reserve indicated it is done raising interest rates but not ready to cut them, with a March rate reduction becoming increasingly unlikely, CNBC reports.
The Federal Open Market Committee removed language suggesting further rate hikes until inflation was controlled, but it stated there are no immediate plans to cut rates while inflation remains above the Fed’s 2% target.
The committee unanimously voted not to raise the fed funds rate, maintaining it in a range between 5.25% and 5.5%, the highest in nearly 23 years. Federal Reserve Chair Jerome Powell mentioned that additional data is needed to confirm ongoing positive trends and deemed a March rate cut unlikely.
The Fed has been riding decelerating inflation, a strong labor market, and solid economic growth, giving it room to ease monetary policy cautiously. The Fed has been allowing its bond holdings to roll off, reducing its balance sheet by over $1.2 trillion.
