The Federal Open Market Committee, excluding four members, sees interest rates staying at the zero to 0.25% range they’re in now for the foreseeable future, according to the Federal Reserve’s latest Summary of Economic Projections, released after its meeting, which ended Wednesday. “The Committee expects to maintain an accommodative stance of monetary policy until” it hits its goal of maximum employment and 2% inflation over the long-term, according to its post-meeting statement. “We will maintain current rate until inflation reaches 2.0%,” Fed Chair Jerome Powell said at his press conference. “Progress has been better than expected, but even so, overall activity is lower than pre-pandemic, and further recovery is unpredictable and uncertain.” He noted median inflation projections have now “increased to 1.2% for this year, 1.7% next year and 2.0% in 2023.” The post-meeting statement, “affirmed the Fed’s commitment to use all measures necessary to boost inflation and improve labor market conditions,” according to Mark Heppenstall, chief investment officer at Penn Mutual Asset Management. “With the zero interest rate policy now expected to last through 2023, the Fed continues to give a green light to investors with little near-term risk of removing the markets’ punch bowl.”
Source: The Bond Buyer
