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The Federal Reserve announced yesterday that its key interest rate would remain unchanged for now, according to The Wall Street Journal (subscription).

The decision: The Fed kept its benchmark rate in a range between 5.25% and 5.5%. While the group has been expected to cut rates at some point this year, there had been significant debate over whether the rate was likely to be cut once or twice before the year is over. As of Wednesday’s meeting, Federal Reserve officials now anticipate just one interest rate cut.

The balancing act: The Fed has taken a tough stance against inflation over the past two years, raising rates in 2022 and 2023 at the fastest pace in decades in an attempt to rein in prices. So far, the economy has remained extremely strong—a development that has surprised some economists.

The outlook: According to Fed Chair Jerome Powell, recent inflation readings have shown improvement, but while there is reason for optimism that inflation is subsiding, combating it will still be a difficult balancing act.

• “We’ve made pretty good progress on inflation,” said Powell, adding that Wednesday’s report was “a step in the right direction … but you don’t want to be too motivated by any single data.”