The Federal Open Market Committee (FOMC) agreed to maintain the current target range for the federal funds rate between 5.25 to 5.5% during its two-day meeting that ended Wednesday.
The committee’s statement noted “considering any adjustments to the target range for the federal funds rate, [they] will carefully assess incoming data, the evolving outlook, and the balance of risks” and the committee “does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%,” which remains the committee’s target objective
“The FOMC opted to hold rates steady in May, and it will likely do so for several more meetings. Given the recent return of price pressures, the committee will demand greater evidence that inflation is truly returning to its target before cutting rates. Although a rate hike in 2024 is no longer unthinkable, the probability remains low. The labor market is healthy, which allows the FOMC to be patient,” said America’s Credit Unions Deputy Chief Economist Curt Long.
The FOMC will next meet June 11 and 12.
