January 29, 2025
In its Federal Reserve press release, The Fed has noted that economic activity continues to grow at a solid pace, with the unemployment rate remaining low and labour market conditions stable. However, inflation is still somewhat elevated. The Committee aims to achieve maximum employment and a 2 percent inflation rate over the long term. They believe the risks to achieving these goals are balanced but acknowledge the economic outlook is uncertain and are attentive to potential risks.
To support these goals, the Committee has decided to keep the federal funds rate target range at 4.25% to 4.5%. They will carefully assess incoming data, the evolving economic outlook, and the balance of risks when considering any future adjustments to the rate. Additionally, the Committee will continue to reduce its holdings of Treasury securities and agency debt and mortgage-backed securities.
The Committee is committed to supporting maximum employment and returning inflation to its 2 percent target. They will monitor incoming information on labor market conditions, inflation pressures and expectations, and financial and international developments. The Committee is prepared to adjust monetary policy if risks arise that could hinder their goals.
Federal Funds Target Rate
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