Core Viewpoint - The Federal Reserve has decided to maintain the federal funds rate target range at 4.25% to 4.50%, marking the fourth consecutive meeting without a rate change, aligning with market expectations [1][3]. Economic Outlook - The Federal Reserve's statement indicates that uncertainty regarding the economic outlook has increased, although it remains relatively high [4]. - The committee is focused on its dual mandate of employment and price stability, noting that the risks of rising unemployment and inflation have increased, despite the unemployment rate stabilizing at low levels [6][8]. Monetary Policy Decisions - The Federal Open Market Committee (FOMC) has committed to maintaining the federal funds rate target range at 4.25% to 4.50% and will carefully assess upcoming data and changes in the economic outlook before making further adjustments [22][24]. - The FOMC is also continuing to reduce its holdings of U.S. Treasuries and agency mortgage-backed securities to support maximum employment and return inflation to the 2% target [24]. Economic Projections - The FOMC's economic projections indicate a downward revision in GDP growth expectations for 2025, 2026, and 2027 to 1.4%, 1.6%, and 1.8%, respectively, compared to previous projections [25]. - Unemployment rate expectations have been adjusted upward to 4.5% for 2025 and 2026, and 4.4% for 2027 [26]. - Inflation projections have been raised, with PCE inflation expected to be 3.0% in 2025, 2.4% in 2026, and 2.1% in 2027, all above the Fed's 2% target [26]. Interest Rate Forecasts - The dot plot indicates that the median forecast for the federal funds rate at the end of 2024 is between 3.75% and 4.00%, suggesting a potential 50 basis points cut from current levels [28]. - There is a notable division among policymakers regarding interest rate cuts, with some expecting at least two cuts this year, while others anticipate no changes [31]. Inflation and Tariff Impact - Federal Reserve Chair Powell emphasized the need for more information regarding the impact of tariffs on inflation and the economy, noting that the current monetary policy stance is appropriate [32][34]. - Powell highlighted that the effects of tariffs on consumer prices are expected to become more pronounced in the coming months, particularly in categories like personal computers and audiovisual equipment [34].