What will Federal Reserve do next? Any hint of future rate hikes will be key focus of latest meeting

BY CHRISTOPHER RUGABER

The Federal Reserve is set to leave its key interest rate unchanged Wednesday as it seeks to guide the U.S. economy toward a “soft landing” of cooling inflation without triggering a deep recession.

Chair Jerome Powell and other Fed officials have made clear that they’re now inclined to move more gradually and cautiously toward their goal of 2% annual inflation. Their more deliberative approach follows the 11 rate hikes they unleashed beginning in March 2022, which substantially raised borrowing costs for consumers and businesses.

Yet with inflation pressures still underlying the economy, Powell won’t be declaring victory on Wednesday, when the Fed’s latest policy meeting ends. The attention of investors and economists will instead focus on what signals the Fed may send about its likely next actions.

The clearest signal will likely come from the Fed’s 19-member interest-rate committee in the batch of economic forecasts its members issue each quarter. The