US Federal Reserve Keeps Benchmark Interest Rates Unchanged

US Federal Reserve has kept the benchmark interest rates unchanged in a range of 5.25 percent to 5.50 percent for the fifth straight time. Federal Reserve Chairman Jerome Powell announced the interest rate decision last night after a two-day Federal Open Market Committee (FOMC) meeting. However, the FOMC said that it expects three rate cuts in 2024 despite sticky inflation.

FOMC members also left the median projection for interest rates at end-2024 at the midpoint between 4.50 and 4.75. This means they still expect 0.75 percentage



points of cuts before the end of the year, which would likely translate into three 0.25 percentage point cuts.

Alongside its rate decision, Fed policymakers also updated their economic forecasts, sharply upgrading the US growth outlook for this year to 2.1 percent, from 1.4 percent in December. Fed policymakers left the headline inflation forecast unchanged, but slightly raised the outlook for annual so-called “core” inflation which excludes energy and food prices to 2.6 per cent.