Fed recap: Chair Powell explains why the central bank isn't ready yet to cut rates

The Federal Reserve held interest rates steady at their current range of 5.25% to 5.5%, but revised its outlook for rate cuts to just one in 2024. Central bank policymakers noted that there has been "modest further progress" toward its 2% inflation objective. Federal Reserve Chair Jerome Powell noted at the press conference that the central bank does not yet have the confidence to cut rates, even as inflation has eased from its peak levels.

The Federal Reserve's restrictive stance on monetary policy is having the effect on inflation central bankers had hoped to see, Fed Chair Jerome Powell said Wednesday afternoon. But central bankers are still waiting to see sufficient progress, he added.

"The question of whether it's sufficiently restrictive is going to be one we know over time," Powell said. "But I think for the reasons I talked about at the last press conference and other places, I think the evidence is pretty clear that policy is restrictive and is having, you know, the effects that we would hope for."

— Sean Conlon

Federal Reserve Chair Jerome Powell said it is unclear why the sentiment of everyday Americans is so sour on the economy.

"I don't think anyone … has a definitive answer why people are not as happy about the economy as they might be," he said.

However, he did say there is a growing economy and strong labor market. While inflation ran high, he noted that the pace of price increases has come down "significantly."

— Alex Harring

Federal Reserve Chair Jerome Powell said no one on the committee has interest rate hikes in their base case.

"We think policy is restrictive. And we think, ultimately, that if you just set policy at a restrictive level, eventually you will see real weakening in the economy," he said.