The Federal Reserve announced today that it would maintain the federal funds rate in a range of 0.25% to 0.50%. This decision reflects the committee’s assessment of the current economic landscape and its commitment to fostering maximum employment and price stability.

Economic Assessment

In its statement, the Fed acknowledged that the labor market had shown signs of slowing. While unemployment remains low, job growth has decelerated in recent months. The committee also pointed to uncertainties surrounding the global economic outlook as a factor influencing its decision.

Inflation has remained below the Fed’s 2% target for several years. However, policymakers expect inflation to gradually rise to 2% over the medium term as the effects of lower energy prices dissipate.

Future Policy

The Fed indicated that it would continue to closely monitor economic and financial developments. Future adjustments to the federal funds rate will be data-dependent, taking into account a wide range of information, including:

• Labor market conditions
• Inflation pressures and inflation expectations
• Financial developments
• International developments

The committee emphasized that it is prepared to adjust its monetary policy stance as appropriate to respond to evolving economic conditions.

Market Reaction

Following the Fed’s announcement, financial markets reacted modestly. Stock prices remained relatively stable, while bond yields edged slightly lower. Investors are now awaiting further clues about the timing of the next rate hike.