The US Central Bank reduces growth expectations and enhances inflation expectations

The Federal Reserve kept interest rates in the United States on Wednesday, even while officials reduced their growth expectations and raised their expectations for inflation.

The latest Federal Reserve’s projections showed that officials now expect the GDP to expand by 1.7 percent this year, with prices increasing by 2.7 percent, amid increasing concerns among investors regarding the impact of Trump administration policies and spending discounts on the largest economy in the world.

Three months ago, officials of the Federal Open Market Committee, and the Central Bank Policy Committee, expected 2.1 percent growth of 2025, and estimated the standards that are closely monitored by the inflation scale in personal consumption expenditures closely for the year by 2.5 percent.

“The uncertainty about the economic outlook increased,” said FOMC statement on Wednesday, after the standards in the United States maintained the target scale of standard standards of federal funds between 4.25-4.5 %.

The latest so-called DOT conspiracy forecasts show the Federal Reserve officials on a large scale other discounts at the rate of quarter or two this year-as is the case in December-after 1 percentage of prices in 2024. However, four FOMC members now do not expect any discounts this year, compared to one in December.

Investors expect between two and three points at the end of 2025.

The Federal Reserve also announced that it will slow down the pace of the quantitative tightening program, which reduces the amount of US Treasury debts it provides to create its public budget every month from $ 25 billion to $ 5 billion starting in April.

Federal Reserve Governor Christopher Waller voted against the decision to slow down quantitative tightening, saying that the current decline of $ 25 billion per month remains appropriate.

All FOMC members support voting decision to keep interest rates.