Federal Reserve Holds Interest Rates Steady – Breaking Update
The Federal Reserve (Fed) recently announced its decision to keep the interest rate unchanged, with the Federal Open Market Committee (FOMC) stating that the unanimous decision was made to support the goal of maximum employment and 2 percent inflation in the long term.
The committee acknowledged that the risks to achieving these targets have shifted towards a more balanced position compared to last year. However, the economic outlook remains uncertain, and the Fed emphasized that they will continue to exercise caution against inflation risks.
This marks the seventh consecutive meeting in which the Fed has maintained the target range for federal funds rates at 5.25-5.50 percent. Since March 2022, the Fed has raised interest rates 11 times, totaling a 525 basis point increase. This has brought the bank’s policy rate to its highest level since 2001.
Despite reaching 9 percent annual inflation in June 2022, recent data shows inflation in the USA was 3.3 percent in May, below expectations.
Fed Chairman Powell delivered a message regarding the Fed’s monetary policy, stating that while progress has been made, they are not yet confident enough to start easing monetary policy. The latest decision to keep the policy rate unchanged reflects the Fed’s cautious approach amid the evolving economic landscape.
