The Fed Leaves Rates Unchanged, but Does That Create New Problems?

The Marriner S. Eccles Federal Reserve building in Washington on Jan. 25, 2022. Stefani Reynolds/AFP via Getty Images

The Federal Reserve has opted to keep its feet on the economic brakes for now and kept the benchmark interest rate unchanged Wednesday.

What Happened

In its first decision of 2022, the policy making Federal Open Market Committee (FOMC) wrapped up its two-day meeting this afternoon by announcing it “decided to keep the target range for the federal funds rate at 0 to 0.25 percent.” The decision was made by an unanimous vote.

Yet the FOMC added that with “inflation well above 2 percent percent and a strong labor market, the Committee expects it will soon be appropriate to raise the target range for the federal funds rate.”