Federal Reserve Holds Interest Rates Steady, Cites Economic Growth and Tight Labor Market


Federal Reserve Board Chair Jerome Powell speaks during a news conference about the Federal Reserve's monetary policy at the Federal Reserve, Wednesday, Jan. 31, 2024, in Washington. (AP Photo/Alex Brandon)
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WASHINGTON (AURN News) — The Federal Reserve announced Wednesday that it would maintain its current interest rates, with Federal Reserve Chair Jerome Powell emphasizing the nation’s economic growth and tight labor market. Powell pointed to GDP growth in the fourth quarter of last year and persistent strength in the labor market as key factors in the decision to keep interest rates unchanged.

“Inflation has eased from its highs without a significant increase in unemployment. That is very good news. But inflation is still too high, ongoing progress in bringing it down is not assured, and the path forward is uncertain,” Powell said.

Television screens on the floor of the New York Stock Exchange show the news conference of Federal Reserve Chair Jerome Powell, Wednesday, Jan. 31, 2024. The Fed kept its key rate unchanged at about 5.4%, a 22-year high. In a statement, it signaled a policy shift by dropping previous wording that had said it was still considering further rate hikes. (AP Photo/Richard Drew)

“I want to assure the American people that we are fully committed to returning inflation to our 2 percent goal. Restoring price stability is essential to achieve a sustained period of strong labor market conditions that benefit all,” he added.

The Fed has consistently emphasized a target inflation rate of 2 percent. Powell acknowledged some progress in reaching this goal but emphasized the need for additional evidence to ensure the economy is on the right track. While signaling a willingness to dial back rates at some point this year, he made it clear that the Fed did not anticipate any immediate changes in March. He also conveyed that the central bank believes it is currently at the peak for raising rates.

Click play to listen to the AURN News report from Jamie Jackson:

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