As expected, the US Federal Reserve decided to hit pause on interest rate hikes while it reviews more data, keeping the benchmark lending rate at 5.5% – a 22-year high.
Fed projections envision another 25 basis point rate hike this year and 50 bps of rate cuts in 2024 versus 100 bps in 2024 in June projections.
Policymakers see much higher GDP growth of 2.1% in 2023, a lower unemployment rate and more progress on core inflation than they saw in June.