
Still cautious about a stubborn inflation rate and unsure what policies may be comin from the White House, the Federal Reserve left its benchmark interest rate right where it was Wednesday.
The Fed lowered its rate last year to 4.3% from 5.3% — cutting it three straight times in the process — in part out of concern that the job market was weakening. According to a report from The Associated Press, hiring had slowed in the summer and the unemployment rate ticked up, at which point Fed officials approved a half-point cut in September.
Hiring rebounded last month and the unemployment rate declined slightly, to a low 4.1%.
In its statement Wednesday, the Fed called the job market “solid” and noted that the unemployment rate “has stabilized at a low level in recent months.”
The Fed said inflation “remains somewhat elevated.” Fed Chair Jerome Powell conveyed a more deliberate approach to interest rate decisions at a press conference with reporters, the AP reported.
“With our policy stance significantly less restrictive than it had been and the economy remaining strong we did not need to be in a hurry we do not need to be in a hurry to adjust our policy stance,” he said.
In December, Fed officials signaled they may reduce their rate just twice more this year. Goldman Sachs economists believe those cuts won’t happen until June and December, the AP reported.
Lindsay Rosner, head of multi sector fixed income investing at Goldman Sachs Asset Management, told the AP “while we continue to think the Fed’s easing cycle has not yet run its course, the (Fed) will want to see further progress in the inflation data to deliver the next rate cut.”