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The Federal Reserve said it will keep interest rates at a 22-year high of 5.25% to 5.5% following a meeting of the Federal Open Market Committee on Wednesday (December 12).
It is the third straight meeting in which the Fed has decided to keep interest rates unchanged. The Federal Reserve indicated that cuts may be coming soon, suggesting it could slash interest rates at least three times in 2024.
The decision comes as inflation and the job market have been cooling.
“Recent indicators suggest that growth in economic activity has slowed substantially from the outsized pace seen in the third quarter. Even so, GDP is on track to expand around 2.5% for the year as a whole,” Federal Reserve Chairman Jerome Powell said.
Stocks soared after the announcement, with the Dow Jones Industrial Average jumping over 400 points and reaching 37,000 for the first time ever. The Nasdaq and the S&P 500 also recorded significant gains.