Fed leaves interest rates unchanged again and signals three cuts coming next year

The Federal Reserve on Wednesday held interest rates steady for the third straight time, signaling that its nearly two-year battle against high inflation may finally be coming to an end as policymakers forecast a series of cuts in 2024.

The widely expected decision left interest rates unchanged at a range of 5.25% to 5.5%, the highest level in 22 years. But policymakers also opened the door to multiple rate cuts next year amid signs the economy is beginning to slow in the face of tighter monetary policy.

New quarterly economic projections laid out after the meeting show that a majority of Fed officials who participated in the meeting expect rates to fall to 4.6% by the end of 2024, suggesting there will be at least three quarter-point rate cuts next year. Policymakers also penciled in additional rate cuts in 2025 and 2026.