The US Federal Reserve decided at its meeting, which concluded yesterday, Wednesday, to keep interest rates unchanged at 4.5%, as expected. It also decided to slow the decline in its holdings of securities by reducing the maximum monthly redemption of Treasury securities from $25 billion to $5 billion.

The bank’s members lowered their economic growth forecasts and raised their inflation expectations. Members now see growth at 1.7% this year, down from 2.1% in their December forecast, and at 1.8% over the next two years, down from 2% and 1.9%, respectively, in their December estimates.

The dot plot report was more hawkish, with four participants seeing no change in interest rates this year, compared to only one member at the December meeting.

The remaining members see two cuts beginning in the second half of the year, two cuts in 2026, and one cut in 2027.

PCE inflation expectations rose to 2.7%, up from 2.5% in the December estimate, and to 2.2% next year, down from 2.2% in the September estimate. Meanwhile, growth expectations declined to 5.9% next year, down from 2.1% in the December estimate.

The statement indicated that the Committee will continue to monitor and monitor incoming economic forecasts and stands ready to adjust the monetary policy stance as necessary.