For the first time in four years, the Federal Reserve's benchmark, short-term rate was scaled back by a half percentage point. The previous 23-year high remained stagnant since July 2023 until September's meeting, marking the new range of 4.75% to 5%.

"The (Fed) has gained greater confidence that inflation is moving sustainably toward 2%, and judges that the risks to achieving its employment and inflation goals are roughly in balance,” the Fed said in a statement after the two-day meeting. "The economic outlook is uncertain, and the Fed is attentive to the risks of both sides of its dual mandate."

But as inflation continues to slow, could we see cuts during the final two Fed meetings of this year? Economists' estimates had scaled back with most rate cut predictions shifting to two or one.

Fed Chair Jerome Powell said officials could speed up or slow the pace of rate cuts depending on how the economy and inflation evolve. Ahead of this week's meeting, this is the Federal Reserve's remaining schedule.

When is the next Fed meeting?

The next Federal Reserve meeting will be held from Nov. 6 through 7.

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Federal Reserve 2024 Meeting Schedule

• Jan. 30–31
• March 19–20
• April 30–May 1
• June 11–12
• July 30–31
• Sept. 17–18
• Nov. 6–7
• Dec. 17–18

Why does the Fed raise interest rates?

The Fed is the nation's central bank, leaving it in charge of monetary policy. This means the Fed sets interest rates and controls the money supply. 

Its dual mandate is to promote "maximum employment and stable prices in the U.S. economy." Stable prices mean the Fed tries to keep inflation in check, with its long-term annual target at 2%. 

To control inflation, one of the Fed's main tools is the federal funds rate, which is the rate banks charge each other for overnight loans. If that rate rises, banks generally pass on their additional cost.

Even though the Fed does not directly control all interest rates in the country, when it raises the fed funds rate, other interest rates eventually follow, including adjustable-rate mortgages, credit cards, home equity lines of credit, and other loans.

What is inflation? 

Inflation is a generalized rise in prices, affecting different goods and services throughout the economy, such as gas, rent and food. 

It can be caused by several factors, such as more people spending money on goods or services that are not readily available to meet that demand. That allows producers and service providers to raise prices without worrying about a significant loss in sales.

Inflation also could be caused by a shortage of supply. If there are not enough goods to meet the demand for a good or service, this could lead to an increase in a manufacturer's or retailer's wholesale costs, which, in turn, would be passed along to consumers through higher retail prices. 

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