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| Version 0 | Version 1 |
|---|---|
| Fed raises rates but cuts 2019 forecast | Fed raises rates but cuts 2019 forecast |
| (35 minutes later) | |
| The Federal Reserve has raised interest rates again - but future increases may come at a slower pace. | The Federal Reserve has raised interest rates again - but future increases may come at a slower pace. |
| Officials at the US central bank voted to lift the Fed's key interest rate by 0.25%, to a target range of 2.25%-2.5%. | Officials at the US central bank voted to lift the Fed's key interest rate by 0.25%, to a target range of 2.25%-2.5%. |
| But estimates released on Wednesday show most members expect two rate increases in 2019 - not three, as previously forecast. | But estimates released on Wednesday show most members expect two rate increases in 2019 - not three, as previously forecast. |
| The shift follows a downturn in US financial markets and concerns about slowing growth in the US and abroad. | The shift follows a downturn in US financial markets and concerns about slowing growth in the US and abroad. |
| Officials now expect economic growth of 2.3% in 2019, down from the 2.5% they anticipated in September. | |
| Members also said they expect inflation to hover around 1.9% next year, compared to a 2% forecast in September. | |
| Greg McBride, chief financial analyst at Bankrate.com, a personal finance website, said: "The Fed downshifted their projections of 2019 economic growth, inflation, and interest rate hikes - not in a big way but enough to remove the urgency of repeated rate hikes." | |
| The Fed has been gradually raising interest rates since 2015, moving the US away from the ultra-low rates put in place during the financial crisis to spur economic activity. | The Fed has been gradually raising interest rates since 2015, moving the US away from the ultra-low rates put in place during the financial crisis to spur economic activity. |
| Wednesday's decision, which was widely expected, marks the ninth increase since 2015 and the fourth this year. | Wednesday's decision, which was widely expected, marks the ninth increase since 2015 and the fourth this year. |
| The moves have made borrowing more expensive. With economic growth expected to slow, some worry that further increases risk stifling economic activity. | The moves have made borrowing more expensive. With economic growth expected to slow, some worry that further increases risk stifling economic activity. |
| US President Donald Trump has been among the loudest voices calling on the Fed to hold off on further increases. | US President Donald Trump has been among the loudest voices calling on the Fed to hold off on further increases. |
| In a statement, the Fed said increases to its benchmark rate would help the US economy sustain its expansion, keep the unemployment rate low and inflation near 2%. | |
| However, the Fed qualified its position a bit, noting that "some" further gradual increases would be justified. | |
| Members also lowered their forecast for interest rates in 2020 and 2021. On average, they now expect the benchmark federal funds rate to hit about 3.1%, down from the 3.4% forecasted in September. |