For the second consecutive meeting, Federal Reserve officials on Nov. 1 held interest rates steady as the central bank aims to quell inflation without overcooling the economy.

The Federal Open Market Committee left the federal funds rate unchanged at a range of 5.25% to 5.5% following its two-day meeting. Since March 2022, the Fed has raised the funds rate, which is now at its highest level since 2001, 525 basis points.

“Given how far we have come, along with the uncertainties and risks we face, the committee is proceeding carefully,” Fed Chairman Jerome H. Powell said at a news conference Nov. 1. At a later point, he said that the committee hasn’t made decision about future rate hikes, though is not considering rates cuts in the near term. Currently, the committee is not confident that it’s reached a restrictive enough stance to bring inflation down to its 2% target, according to Powell.

With that in mind, whether the Fed has reached the end of its rate hike campaign remains a question. At its last meeting in September, committee members forecasted one more rate quarter-point increase this year.

Fed officials in recent months have said the rise in bond yields has made borrowing more expensive and may make another rate hike moot. The yield on the 10-year Treasury has jumped to 4.88% as of Oct. 31 from 3.59% on May 1.

“These higher Treasury yields are showing through to higher borrowing costs for households and businesses, and those higher costs are going to weigh on economic activity to the extent this tightening persists,” Powell said.

The committee’s median projection for the federal funds rate at the end of 2023 remained at 5.6%, according to projections the Fed released in September, the same level it forecasted in June. But committee members in September also projected holding rates higher for longer: By the end of 2024, the committee’s median projection is 5.1%, up from 4.6% in June, and by the end of 2025 it’s 3.9%, up from 3.4% in June.

Overall, inflation has been steady in recent months, and on Oct. 12 the Bureau of Labor Statistics reported that the consumer price index rose 3.7% year-over-year in September, the same pace as August.

The committee’s 12 members unanimously approved maintaining rates at the current level and said in a statement that they will continue to “take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments” when weighing additional policy firming.

The committee is monitoring the economic implications from rising global geopolitical tensions, including the Israel-Hamas war, and domestic issues, like a potential government shutdown later this month, Powell said.

However, Powell added that the “bigger picture from our standpoint is we’ve got a very strong economy, strong labor market, making progress on the labor market, making progress on inflation, and we’re very focused on getting confident that we have achieved a stance of monetary policy that is sufficiently restrictive.”

Shortly after the Nov. 1 announcement, market participants indicated there is a 80% probability that the Fed will leave rates unchanged at its next meeting, according to the CME FedWatch Tool that tracks trading in the 30-day fed funds futures.

The committee’s final meeting of the year is slated for Dec. 12-13.