Federal Reserve Holds Rates Steady, Signals Cut in September

Fed policymakers have observed ’some' progress in inflation in recent months.

Federal Reserve Chairman Jerome Powell speaks at a news conference following a Federal Open Market Committee meeting at the William McChesney Martin Jr. Federal Reserve Board Building in Washington on July 31, 2024. Andrew Harnik/Getty Images

The Federal Reserve is inching closer to cutting interest rates, signaling a rate reduction as soon as September if inflation continues trending downward and the labor market remains solid.

Meanwhile, Fed officials left the policy rate unchanged at a 23-year high of 5.5 percent following the two-day policy meeting that concluded on July 31.