Fed holds rates steady as 'lack of further progress' on inflation signals higher for longer stance

Slowdown of QT programme

Valeria Martinez
clock • 2 min read

The Federal Reserve kept interest rates unchanged on Wednesday (1 May) as the central bank expressed concerns over a "lack of further progress" in getting US inflation back to the 2% target.

Officials at the Federal Open Market Committee unanimously opted to leave the target range for the federal funds rate at 5.25% to 5.5%, where it has stood since July last year. This followed a series of upside inflation surprises since the FOMC's last meeting in March. In a press conference, Fed chair Jay Powell declined to say whether three rate cuts — the median estimate of Fed officials in March — were still an expectation for 2024. Instead, he reiterated that it will now take more time than initially anticipated for the Fed to gain confidence that inflation is steadily declining t...

To continue reading this article...

Join Investment Week for free

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

More on US

Federal Reserve holds interest rate steady amid cooling inflation
US

Federal Reserve holds interest rate steady amid cooling inflation

5.25-5.5% hold

clock 13 June 2024 • 2 min read
US appeals court rejects SEC's new disclosure rules for private equity and hedge funds
US

US appeals court rejects SEC's new disclosure rules for private equity and hedge funds

A ‘significant victory’ for markets

clock 06 June 2024 • 1 min read
Can the Fed ignore political pressures as the presidential election approaches?
US

Can the Fed ignore political pressures as the presidential election approaches?

Central bank independence questioned

Christophe Boucher and Benoît Begoc
clock 31 May 2024 • 4 min read
Trustpilot