Fed stays on pause, most officials see three rate cuts in 2024

The Federal Reserve has left interest rates unchanged, maintaining a target range for the federal funds rate at 5.25 to 5.5%. In the statement, FOMC officials say the Committee "judges that the risks to achieving its employment and inflation goals are moving into better balance."

The March release also includes an updated Summary of Economic Projections. That release shows nine officials see three rate cuts in 2024.

Yahoo Finance Federal Reserve Reporter Jennifer Schonberger reports on the Fed's decision.

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Editor's note: This article was written by Stephanie Mikulich.

Video Transcript

- No change. The Federal Reserve holding rate steady in the range of 5.25% to 5.5%, as officials still see three rate cuts this year. This, even as officials revise their outlook for inflation higher this year based on core PCE, to 2.6% from 2.4% previously forecast.

Officials also upwardly revising their outlook for GDP sharply to 2.1% from 1.4% previously. Unemployment now seen finishing the year at 4% versus 4.1% previously. Nine officials now see cutting rates three times this year. That's up from six. While five see two cuts-- while five see two cuts and two see one cut.

Next year, officials now see only three cuts, as opposed to four cuts previously forecast. Officials, again, cautioning they won't begin lowering rates until they achieve greater confidence that inflation is heading back to their 2% target sustainably.

Now, I do want to also mention the neutral rate because that was raised by a hair to 2.6% from 2.5% previously forecast. Remember, that is the rate that neither spurs nor suppresses growth. Now, separately, on the balance sheet, no changes in language in the statement. Officials said that they will carry forward with plans as previously announced. This decision was unanimous.