by Luzi Ann Santos | moomoo News

3:16 p.m. NY time

Federal Reserve Chairman Jerome said the US economy continues to exhibit solid growth of around 2%, even as he acknowledged increasing financial pressures on more lower income households with interest rates at current level.

"Consumer spending is still growing," Powell said at a press conference. "We do see the same thing other people see, which is, you know, increasing financial pressures on more lower income people and, you know, the best thing we can do is to foster a very strong jobs economy, which we think we have done."

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3:01 p.m. NY time
Federal Reserve Chairman Jerome said policy makers are getting good results in their efforts to slow inflation, even as they continue to watch out for signs of economic weakness.

"We kind of see what we wanted to see, which was gradual cooling in demand, gradual rebalancing in the labor market while we continue to make progress on inflation," Powell said at a press conference.  "We're getting good results here."

Powell reiterated that Fed officials think rates will come down to support growth, acknowledging that the recent interest rate hikes that set the monetary policy at restrictive level could lead to weakening in the economy.

"We've been getting is good progress on inflation with growth at a good level and with a strong labor market," he said.  "Now, ultimately, we think rates will have to come down to continue to support that.  But so far, they haven't had to."

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2:52 p.m. NY time

Federal Reserve Chairman Jerome Powell said policy makers said progress in inflation paused in the first quarter, prompting policy makers to rethink the projections for three quarter-point cuts in interest rates they had in March.

"The big thing that changed was the inflation forecast, moved up several p tenths before the end of the year," Powell said at a press conference. "What we took away from that was that it's probably going to take longer to get confidence we need to begin to loosen policy."

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2:36 p.m. NY time

Powell said inflation is still too high at a press conference after policy makers decided to keep interest rates unchanged and penciled in just one rate cut this year.

"Inflation has eased substantially from a peak of 7% to 2.7% but is still too high," Powell said at the press conference after the Federal Open Market Committee decided to keep the key interest rates unchanged at a range of 5.25% to 5.5%. "We are maintaining our restrictive stance of monetary policy in order to keep demand in line with supply and reduce inflationary pressures."

The median projections see the fed funds rate at 5.1% by the end of this year, up from 4.6% expected in March when policy makers last released their so-called dot plot that illustrates the FOMC members' expectations. For next year, the rate is expected to be at 4.1% and for 2026, it's 3.1%. Longer run projections have the key borrowing cost at 2.8%.

The Fed board members expects core personal consumption expenditures (PCE) inflation at 2.8% this year, before declining to 2.3% next year and 2% in 2026.