Fed Leaves Policy Rate Unchanged

The Federal Open Market Committee (FOMC) announced on Wednesday that it left the benchmark interest rate, the target range for federal funds, unchanged at 0%-0.25% as widely expected. In its policy statement, the Fed noted that if progress continues toward employment and inflation goals broadly as expected, a moderation in the pace of asset purchases may soon be warranted.

The US Federal Reserve’s updated Summary of Economic Projections revealed on Wednesday that half of the policymakers (9) see a lift-off in the fed funds rate from zero in 2022, compared to seven policymakers in June’s publication.

“Fed policymakers see first rate hike in 2022: median forecast in Summary of Economic Projections.”
“Half of Fed policymakers see lift-off in fed funds rate from zero in 2022, vs 7 of 18 in June forecast; all but one see liftoff by end-2023 (vs 13 in June).”
“Fed’s median view of fed funds rate at end-2022 0.3% (prev 0.1%).”
“Fed’s median view of fed funds rate at end-2023 1.0% (prev 0.6%).”
“Fed’s median view of fed funds rate at end-2024 1.8%.”