The Federal Reserve decided to maintain the target range for the federal funds rate at 5.25% to 5.5% for the eighth consecutive meeting, indicating the possibility of a rate cut in September.

The Fed announced on Wednesday that it will keep the interest rate steady at 5.25%- 5.5% and continue reducing its holdings of treasury securities, agency debt, and agency mortgage-backed securities.

In its most recent meeting, the Federal Reserve left the federal funds rate unchanged at 5.25% to 5.5% for the eighth time. The Fed acknowledged that job gains have moderated, and the unemployment rate has slightly increased while remaining low.

The Fed also observed that recent data suggests solid expansion in the U.S. economic activity and reaffirmed its commitment to achieving maximum employment and a long-term inflation rate of 2%.

The Federal Reserve believes that the risks to achieving its goals are becoming more balanced and underscored that it will carefully evaluate incoming data, evolving economic conditions, and the balance of risks.

The Committee expects to reduce the target range once it has gained greater confidence that inflation is moving sustainably toward 2% and reiterates its commitment to returning inflation to its 2% objective.

The Fed emphasized that its assessments consider various information, including labour market conditions, inflation pressures and expectations, and financial and international developments.

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