The US Federal Reserve on Wednesday kept its key interest rate unchanged for the second time, in line with expectations. In addition, core inflation rate is expected to be at 2.7% by end of 2026, up from 2.5% forecast in December.
At its last meeting, the Federal Reserve kept its policy interest rate steady in the 3.50%–3.75% range. Before that, it had delivered three consecutive rate cuts of 0.25% each to prevent a softening labour market from slipping into higher unemployment.
-
Indian Markets Turning Corner After Two Tough Years, Says Sandeep Tandon -
NDTV Profit Ignite 2026: Experts See Opportunity In Equities, Stay Bullish For Long-Term -
Buy Right, Sit Tight Does Not Work for Individual Stocks, Says Dinshaw Irani -
'Worst Is Behind': Quant MF Sees Market Bottom, Flags 'Extreme Euphoria' In Midcaps -
India's Mutual Fund Industry Could Become A $1 Trillion Opportunity, Say Fund Managers -
'Foreign Investors Are Baraatis': Raamdeo Agrawal's Take On LTCG Tax -
Stay Invested Through Market Cycles: Raamdeo Agrawal at NDTV Profit Ignite -
Ramesh Damani Remains Bullish On India For Next 20-30 Years, Sees Bargains Amid Market Weakness -
CAS Came After A Long Consultation Process: SEBI Chairman Tuhin Kanta Pandey AT NDTV PROFIT IGNITE -
Aim To Cut FPI Onboarding Time From Mth To Five Days: SEBI Chairman Tuhin Kanta Pandey AT NDTV PROFI
Here are the key highlights from the FOMC meet and Federal Reserve Chair Powell speech and press conference:
Near-Unanimous Decision
Jerome Powell and ten other members voted for maintaining the interest rate, while voting against the action was Stephen I. Miran, who preferred to lower the target range for the federal funds rate by 1/4 percentage point.
Inflation Outlook Revision
The Federal Reserve officials revised the core inflation outlook upward to 2.7%, compared to 2.5% forecast in December. Even though inflation has made further progress toward the Committee's 2% objective but remains 'somewhat elevated,' the Federal Reserve said in a statement.
Powell, in his speech, said, "Near term inflation expectation are up in the recent weeks."
"Main thing we are looking for is lowering goods inflation," he added.
He further added that "If we don't see inflation progress, won't see rate cut."
Higher GDP Forecast
The US Federal Reserve raised the median GDP 2026 projections to 2.4% from 2.3%. Addressing the upward projections, Powell said that it reflected confidence in productivity.
No One Knows What Impact Of Middle East War Will Be
“The US economy is doing pretty well,” Powell said. But, “We don't know what the effects of this will be,” he said. “Really, no one does.”
He further added that energy prices will push up overall inflation and some of the oil shock will show up in core inflation. The series of shock due to the Middle east war have interrupted inflation progress, he pointed.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.