Chair Jerome Powell will enter this week’s Federal Reserve meeting in a much more desirable position than he likely ever expected: Inflation is getting close to the Fed’s target rate, the economy is still growing at a healthy pace, consumers keep spending and the unemployment rate is near a half-century low.
The Federal Reserve kept its key short-term interest rate unchanged Wednesday for a second straight time but left the door open to further rate hikes if inflation pressures should accelerate in the months ahead.
Most Federal Reserve officials last month still regarded high inflation as an ongoing threat that could require further interest rate increases, according to the minutes of their July 25-26 meeting released Wednesday.
Don’t call it a “pause.” When the Federal Reserve meets next week, it is widely expected to leave interest rates alone — after 10 straight meetings in which it has jacked up its key rate to fight inflation.