The Federal Reserve is staying on pause, keeping the federal funds rate in a target range of 5.25% to 5.50%. In its statement, the Federal Open Market Committee says that economic indicators show that "growth of economic activity has slowed from its strong pace in the third quarter" and that job gains have moderated. Inflation, the statement says, has eased, but "remains elevated." In its Summary of Economic Projections, policymakers see 75 basis points worth of cuts in 2024.

Yahoo Finance Federal Reserve Reporter Jennifer Schonberger breaks down the Fed's decision and statement.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Video Transcript

JENNIFER SCHONBERGER: No change. The Federal Reserve maintaining rates in the range of 5.25% to 5.5%, but signaling they will cut rates next year, while still keeping the door open for any future rate hikes on the table. Officials see cutting rates by 75 basis points next year, implying three rate cuts next year. Breaking that down, 5 officials see 2 cuts next year, 6 see 3 cuts, and 4 see 4 cuts looking ahead to 2025.

Officials anticipate cutting rates four more times. These projections coming as the Fed sees inflation dropping to 2.4% next year and then further dropping to 2.2% in 2025. Acknowledging the progress in inflation, officials change longtime held language in their statement, saying that inflation has, quote, "eased over the past year, but remains elevated." This from just saying that inflation remains elevated and numerous previous statements.