Author: Scott Horsley / Source: NPR.org
Updated at 4:16 p.m. ET
The Federal Reserve is signaling that it may be done hiking interest rates this year, amid signs of economic slowing.
The Federal Reserve’s Open Market Committee on Wednesday left its target rate unchanged at 2.25 percent to 2.5 percent. More than half the committee’s members signaled they don’t expect any additional rate increases this year. That’s a sharp change from December when the Fed was anticipating as many as three rate hikes in 2019.
“We see no need to rush to judgment,” Federal Reserve Chairman Jerome Powell said in explaining the committee’s wait-and-see approach. “It may be some time before the outlook for jobs and inflation calls clearly for a change in policy.”
Policymakers highlighted the sluggish pace of hiring in February, when only 20,000 jobs were added, as well as a slowdown in household spending and business investment.
The Fed also lowered its expectation of economic growth for 2019 to just 2.1 percent. The forecast for unemployment rose slightly to a still-low 3.7 percent.
Despite those warning signs, Powell stressed that the outlook for the U.S. economy is still positive. Consumer spending could bounce back, for example, after a disappointing holiday shopping season.
“Given the overall favorable conditions in our economy, my colleagues and I will be patient in assessing what if any changes in the stance of policy may be needed,”…
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