The major stock indexes fell sharply on Wednesday after the Federal Reserve cut interest rates by one quarter of a point but officials indicated that they see fewer cuts and more persistent inflation ahead.
The Dow Jones Industrial Average fell by more than 500 points, or 1.2 percent. The Nasdaq Composite dropped two percent. The S&P 500 declined 1.5 percent. The Russell 2000 index of smaller companies fell by more than 2.6 percent.
The projections of Fed officials, which are released at ever other meeting of the Federal Open Market Committee, indicated a median forecast of just two cuts next years, down from four when the Fed last released projections in September. The Fed now sees the Fed funds rate at 3.9 percent at the end of next year, a half a point higher than the earlier projections.
The Fed’s projections for further out also show higher rates. The Fed now sees its…
