Fed sees growth surge, jump in inflation this year but no change on rates

Fed sees 2021 GDP growth of 6.5%, unemployment at 4.5%; Powell says worst economic outcomes of pandemic avoided

The Federal Reserve on Wednesday repeated its pledge to keep its target interest rate near zero for years to come after projecting a rapid jump in US economic growth and inflation this year as the Covid-19 crisis winds down.

The US central bank now sees the economy growing 6.5% this year, which would be the largest annual jump in gross domestic product since 1984, and the unemployment rate falling to 4.5% by year's end. That compared with projections in December of 4.2% GDP growth and 5% unemployment.

The pace of price increases is now expected to exceed the Fed's 2% target for