Fed pauses rate hikes for second time this year, but hints at another increase

The Federal Reserve on Wednesday held interest rates steady for the second time this year, pausing its tightening campaign to assess how the economy is faring in the face of higher borrowing costs. 

The widely expected decision left interest rates unchanged at a range of 5.25% to 5.5%, the highest level since 2001. But policymakers also left the door open to an additional increase before the end of the year – and indicated that rates are likely to remain at peak levels longer than previously expected.

New economic projections laid out after the meeting show that a majority of Fed officials who participated in the meeting expect rates to rise to 5.6% by the end of 2023, suggesting one more quarter-point increase this year. The Fed meets two more times this year, in November and December.