By The Federal Reserve projected lowering interest rates by another half point before the end of 2024, and the central bank has two more policy meetings to do so.
The so-called “dot plot” indicated that 19 FOMC members, both voters and nonvoters, see the benchmark fed funds rate at 4.4% by the end of this year, equivalent to a target range of 4.25% to 4.5%. The Fed’s two remaining meetings for the year are scheduled on Nov. 6-7 and Dec.17-18.
Through 2025, the central bank forecasts interest rates landing at 3.4%, indicating another full percentage point in cuts. Through 2026, rates are expected to fall to 2.9% with another half-point reduction.
The central bank lowered the federal funds rate to a range between 4.75%-5% on Wednesday, its first rate cut since the early days of the Covid pandemic.
Here are the Fed’s latest targets:
Meanwhile, the Fed officials hiked their expected unemployment rate this year to 4.4%, from the 4% projection at the last update in June.
Meanwhile, they lowered the inflation outlook to 2.3% from 2.6% previous. On core inflation, the committee took down its projection to 2.6%, a 0.2 percentage point reduction from June.
