Fed keeps rates steady, observes stabilizing market conditions but elevated inflation remains

The Federal Reserve Federal Open Market Committee (FOMC) kept rates steady at its most recent meeting. The committee observed an unemployment rate that is stabilizing at a low level while labor market conditions remain solid. The Committee cautioned that inflation remains somewhat elevated, necessitating the choice to keep rates stable, and Federal Reserve Chair Jerome Powell addressed those concerns in a press conference.

America’s Credit Union’s Chief Economist Curt Long released the following statement:

“The FOMC made no changes to the fed funds rate target at its May meeting. Chair Powell conveyed the elevated level of uncertainty attached to the committee’s economic outlook and the need for the committee to be highly data dependent going forward. This suggests that the Fed will have a more reactive posture than normal and raises the risk that it may act too late to stabilize the economy should growth weaken. Regardless, credit unions will serve as positive, local sources of financial stability within their communities.”