The Federal Reserve predicts only one interest rate cut in 2024
Fed decision-making package for lazy people: Inflation is progressing, interest rates are expected to be cut by 1% this year, and no one is considering raising interest rates.
The Federal Reserve (Fed) on Wednesday (12th) maintained the federal funds rate target range at 5.25-5.50%, but predicted only one rate cut in 2024. Federal Reserve Chairman Jerome Powell pointed out at a press conference that even if inflation has fallen from its highest level, the central bank still does not have the confidence to cut interest rates.
Highlights from the Fed’s latest interest rate statement and Ball’s press conference are as follows:
The closely watched "dot plot" suggests that the central bank will become more hawkish in 2024, but will adopt a dovish interest rate policy path in 2025.
According to the latest interest rate policy "dot plot" released on Wednesday, Fed members currently expect the federal funds rate to fall to 5.1% this year and to remain at around 4.1% by the end of next year.
Eight of the 19 FOMC voting members expect two rate cuts this year. 7 people predicted one rate cut, and 4 policymakers expected no rate cut this year, which means that the Federal Reserve will only cut interest rates once in 2024, lower than the three times previously expected in March. FOMC officials expected four rate cuts in 2025, a high than the previous 3 times expected.