March 29 (Reuters) -

The U.S. Federal Reserve held the benchmark interest rate

steady in the 5.25% to 5.5% range at its March policy meeting,

and officials continued to anticipate approving three

quarter-point interest rate cuts by the end of 2024.

Before policymakers begin to ease borrowing costs they

say they want to see more data confirming that inflation is

returning to their 2% target.

Here's a recap of recent key data watched by the central

bank:

INFLATION (PCE released March 29; next release CPI April

10):

The personal consumption expenditures

(PCE) price index

, which the Fed uses to set its 2% inflation target,

increased at a 2.5% annual rate in February, up from the 2.4%

rate seen in January. Core inflation stripped of volatile food

and energy prices rose 2.8%, a slight decline from a January

number that was revised up to 2.9%. Neither number is likely to

boost confidence among Fed policymakers that inflation will

steadily return to their target.

The CPI had risen 3.2% on a year-on-year basis in February,

a tick up from 3.1% in the prior month, and higher than analysts

expected. The core rate excluding food and energy costs,

meanwhile, only edged down to 3.8% from 3.9%, another reminder

that the Fed's inflation battle may last longer than

anticipated. Rising gasoline and shelter costs contributed the

bulk of the CPI increase. Whether the Fed's hoped-for consistent

easing in housing costs is imminent remains uncertain.

EMPLOYMENT (Released March 8; next release April 5):

U.S. firms added a larger-than-expected 275,000 jobs in

February, though employment gains in the previous two months

were revised lower by 167,000. The unemployment rate rose to a

two-year high of 3.9% as a rise in the size of the workforce was

outweighed by a larger increase in the number of people

reporting they were out of work.

Fed officials have become more comfortable with the idea

that continued strong job growth could still allow inflation to

fall, especially if the supply of labor continues to grow and

wage growth eases.

On the wage front, growth eased on a month-to-month

basis to just 0.1%, the smallest increase in two years and

essentially neutralizing the unexpectedly strong jump in hourly

pay the month before.

The annual increase, meanwhile, slowed to 4.3% from 4.4%.

While marking further progress, that level is still well above

the 3.0%-3.5% range that most policymakers view as consistent

with the Fed's 2% inflation target.

JOB OPENINGS (Released March 6; next release April 2)

Fed Chair Jerome Powell keeps a close eye on the U.S. Labor

Department's Job Openings and Labor Turnover Survey (JOLTS) for

information on the imbalance between labor supply and demand,

and particularly on the number of job openings potentially

available to each person who is without a job but looking for

one. The ratio had been falling steadily towards its

pre-pandemic level, but has stalled for the last four months at

just above 1.4-to-1, higher than the 1.2-to-1 level seen before

the health crisis. Other aspects of the survey, like the quits

rate, have edged back to pre-pandemic levels.

RETAIL SALES (Released Feb. 15; next release March. 14):

Retail sales fell more than expected in January, dropping

0.8%. They were pulled down by declines in receipts at auto

dealerships and gasoline service stations, and consumer spending

was also likely weighed down by winter storms. The decline

followed a fairly strong performance over the holiday season and

could indicate economic growth will slow sharply this quarter.

If it does, it would finally be a sign the aggressive rate

hikes Fed policymakers delivered from March 2022 to July 2023

are trimming overall demand for goods and services in what has

up to now been a markedly resilient economy.