At its final rate decision of 2023, the Federal Reserve is likely to keep its benchmark interest rate near zero, where it has been since the COVID-19 pandemic began to impact the economy. The Fed is likely to keep borrowing costs low to support an economy that continues to be slow to recover from the pandemic. It is possible the Fed may choose to keep the fed funds rate at zero, implement additional asset purchase programs, or modify details of its current bond-buying program. The Fed may also provide more guidance on its plans for returning the benchmark interest rate to more normal levels when the economic recovery is more firmly established.
