The Fed: No Rate Cuts Yet

As expected, the Federal Reserve did not cut rates today holding steady at 5.25-5.5% for the 5th straight meeting.

Inflation remained higher than expected again in February at 3.2%. But The Fed says it is still optimistic about the forecast of three interest rate cuts later this year.

“We believe that our policy rate is likely at its peak for this type of cycle, and that if the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year,” said Federal Reserve Chairman Jerome Powell.

And as for the high inflation numbers to start to the year?

“I think they haven’t really changed the overall story, which is that of inflation moving down gradually on a sometimes bumpy road toward 2%,” Powell said, “We’re not going to overreact to these two months of data, nor are we going to ignore them.”

“Nonetheless, we’re looking for data that confirm the low readings that we had last year,” Powell continued. “And give us a higher degree of confidence that what we saw was really inflation moving sustainably down to 2%.”

Former Ronald Reagan economist Art Laffer told FOX, he's not sold on the 3 rate cuts coming this year.

"If they did 3 cuts this year, most people would think that was a political gesture trying to get Biden re-elected. I'm sure they don't believe that to be the case, but that's the way it looks and that's unfortunately something that the Fed shouldn't do."

The Federal Reserve's next monetary decision will be made and announced on May 1st.