Fed keeps rates on hold as expected at 3.50-3.75%; removes forward guidance completely; Statement approved in 12-0 vote; Says "The Committee will deliver price stability"

• The Committee decided to maintain the target range for the federal funds rate at 3-1/2 to 3-3/4 percent, in support of the Federal Reserve's dual mandate.
• The Committee reaffirmed its policy of maintaining ample reserves in the banking system.
• Economic activity is expanding at a solid pace despite elevated uncertainty that owes, in part, to the conflict in the Middle East.
• Productivity growth and capital investment are strong.
• Job gains have kept pace with the workforce, and the unemployment rate has changed little.
• Inflation remains elevated relative to the Committee's 2 percent goal, in part reflecting supply shocks that have driven price increases in certain sectors, including energy.
• The Committee will deliver price stability.

SEP's below:

Federal Funds Rate 

• 2026: 3.8% (exp. 3.625%, prev. 3.4%)
• 2027: 3.6% (exp. 3.375%, prev. 3.1%)
• 2028: 3.4% (exp. 3.125%, prev. 3.1%)
• Longer run: 3.1% (exp. 3.125%, prev. 3.1%)

Change in Real GDP 

• 2026: 2.2% (exp. 2.2%, prev. 2.4%)
• 2027: 2.3% (exp. 2.3%, prev. 2.3%)
• 2028: 2.2% (exp. 2.1%, prev. 2.1%)
• Longer run: 2.0% (exp. 2.0%, prev. 2.0%)

Unemployment Rate 

• 2026: 4.3% (exp. 4.4%, prev. 4.4%)
• 2027: 4.3% (exp. 4.3%, prev. 4.3%)
• 2028: 4.2% (exp. 4.2%, prev. 4.2%)
• Longer run: 4.2% (exp. 4.2%, prev. 4.2%)

PCE Inflation 

• 2026: 3.6% (exp. 3.5%, prev. 2.7%)
• 2027: 2.3% (exp. 2.4%, prev. 2.2%)
• 2028: 2.0% (exp. 2.0%, prev. 2.0%)
• Longer run: 2.0% (exp. 2.0%, prev. 2.0%)

Core PCE Inflation 

• 2026: 3.3% (exp. 3.1%, prev. 2.7%)
• 2027: 2.5% (exp. 2.3%, prev. 2.2%)
• 2028: 2.1% (exp. 2.0%, prev. 2.0%)

Distribution of dots for 2026:

• Three hikes, 4.375%: 1 (prev. 0)
• Two hikes, 4.125%, 5 (prev. 0)
• One Hike, 3.875%: 3 (prev. 0)
• Unchanged, 3.625%: 8 (prev. 7)
• One Cut, 3.375%: 1 (prev. 7)
• Two Cuts, 3.125%: 0 (prev. 2)
• Three cuts, 2.875%: 0 (prev. 2)
• Four cuts, 2.625%: 0 (prev. 1)