Powell Says Fed Doesn't Have Preset Policy Path, Impact of Hikes Uncertain

The FOMC initially kept interest rates near zero to support economic recovery. As the economy improved, rates were gradually increased to more normal levels. The FOMC forecasts solid growth, low unemployment, and stable inflation but acknowledges the uncertainty of forecasts. Policymaking involves balancing risks of moving rates too fast or too slow. The FOMC remains flexible, adjusting policies based on incoming data to maintain economic stability.

What factors does the FOMC consider when making decisions about monetary policy?

How does the FOMC's gradual increase in interest rates relate to economic growth and inflation?