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Fed leaves interest rates unchanged

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thumb_up 77 comment 34 2026 2 months ago
The Federal Reserve left interest rates unchanged on Wednesday as policymakers weigh higher-than-expected inflation readings, an uncertain labor market and a new war in the Middle East.   The decision from the Federal Open Market Committee (FOMC) leaves the benchmark lending rate at a target range of 3.5% to 3.75%, where it has been since last December.   Fed Chair Jerome Powell said economic activity is expanding at a solid pace, consumer spending remains resilient and the unemployment rate is steady. But he said the housing sector is weak, job gains are low and the Iran war is injecting further uncertainty into the economic outlook.   "The implications of events in the Middle East are uncertain. In the near term, higher energy prices will push up overall inflation, but it is too soon to know the scope and duration of potential effects on the economy," he said.   Looking forward, the median FOMC participant expects one quarter-point reduction this year and another one in 2027, though the timing remains unclear.   "The forecast is that we will be making progress on inflation, not as much as we had hoped, but some progress on inflation," Chair Powell said. "The rate forecast is conditional on the state of the economy. So, if we don't see that progress, you won't see that rate cut."   #federalreserve #fomc #jeromepowell #inflation #cspan