The Federal Reserve, led by Chair Jerome H. Powell, has kept interest rates unchanged at 4.25%-4.5% as of March 2025. This decision extends the pause in the rate-cut cycle that began in January, aligning with expectations ¹.

*Key Points:*

- *Federal Funds Rate*: Remains at 4.50%

- *Interest Rate Projections*:

- 2025: Anticipated reduction of around 50 basis points

- 2026: Projected rate of 3.50%

- 2027: Projected rate of 3.25%

- *Economic Outlook*:

- GDP growth forecast revised lower to 1.7% for 2025

- Unemployment rate expected to be slightly higher at 4.4% in 2025

- *Inflation Projections*:

- PCE inflation seen higher in 2025 at 2.7% and 2026 at 2.2%

- Long-term inflation goal remains at 2%

Recent statements from Federal Reserve officials, including Governor Lisa D. Cook and Vice Chair Philip N. Jefferson, highlight the ongoing efforts to monitor the economy and adjust monetary policy accordingly ².