WASHINGTON (NEWSnet/AP) — Federal Reserve officials kept their benchmark interest rate stable after ending their latest meeting Wednesday.

In their new quarterly projections, Fed officials forecast that stronger growth and stubborn inflation will persist. Under those circumstances, they projected that interest rates would have to stay slightly higher for longer. The Fed range will remain between 5.25% and 5.5%.

There is now an expectation of three rate cuts occurring later in 2024, down from four in their December projections. They also expect “core” inflation, which excludes volatile food and energy costs, to still be 2.6% by the end of 2024, up from their previous projection of 2.4%. In January, core inflation was 2.8%, according to the Fed’s preferred measure.

As a whole, their forecasts suggest that the policymakers expect the U.S. economy to continue enjoying an unusual combination: A healthy job market and economy in tandem with inflation that continues to level off gradually.

Most economists have pegged the Fed’s June meeting as the most likely time for it to announce its first rate cut, which would begin to reverse the 11 hikes it imposed beginning two years ago.

While the Fed’s hikes did help tame inflation, they have also made borrowing costlier for businesses and households.

Rate cuts would, over time, lead to lower costs for home and auto loans, credit card borrowing and business loans.

In many respects, the U.S. economy remains heathy. Employers keep hiring, unemployment remains low, and the stock market is hovering at record highs. Yet average consumer prices remain much higher than they were before the pandemic — a source of unhappiness for many Americans for which Republicans have sought to pin blame on Biden.

Several other major central banks are also keeping rates high to ensure that they have a firm handle on consumer price spikes.

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