The Federal Reserve left interest rates unchanged on Wednesday following its first policy meeting of the second Trump administration. The decision keeps the target range for the federal funds rate at 4.25% to 4.5% after three consecutive rate cuts. After making progress on inflation for much of last year, the Consumer Price Index (CPI), a broad measure of prices paid for goods and services, ticked up in the last two months. Headline inflation rose 0.4% in December, marking a 2.9% increase over the past 12 months. Federal Reserve Chair Jerome Powell said the central bank was in no rush to change its current course. “With our policy stance significantly less restrictive than it had been, and the economy remaining strong, we do not need to be in a hurry to adjust our policy stance,” he told reporters. Chair Powell said the central bank was on no preset course when it comes to further policy adjustments. “If the economy remains strong and inflation does not continue to move sustainably toward 2%, we can maintain policy restraint for longer. If the labor market were to weaken unexpectedly or inflation were to fall more quickly than anticipated, we can ease policy accordingly,” he said. “Policy is well positioned to deal with the risks and uncertainties that we face in pursuing both sides of our dual mandate.”
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