FOMC Statement Highlights Inflation Concerns, Signals Slower Rate Cuts Ahead

02:20 PM EDT, 06/18/2025 (MT Newswires) -- The Federal Open Market Committee maintained the federal funds rate at the current range of 4.25% to 4.5%, the FOMC's statement Wednesday afternoon showed, expressing increased concerns about inflation and suggesting fewer rate reductions over the next few years.

The updated Summary of Economic Projections still anticipates two rate reductions in 2025, ending the year at a median rate of 3.9%.

However, there is now expected to be only one rate cut in 2026, down from two in the previous estimate, and one rate cut in 2027, the same as previously forecast, leaving the median rate at the end of 2027 at 3.4% rather than 3.1%.

The expected pace of inflation was revised up for both overall and core PCE price measures for each of the next three years.

Expected GDP growth was revised lower for 2025 and 2026 and the unemployment rate was revised up for each of the next three years.

"Uncertainty about the economic outlook has diminished but remains elevated," the statement said. "The committee is attentive to the risks to both sides of its dual mandate."

Federal Reserve Chairman Jerome Powell's press conference begins at 2:30 pm ET.

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