Fed Chairman Jerome Powell indicated this Wednesday that interest rates will remain in the 3.5 %–3.75 % range, while tempering expectations of short-term cuts.

On the other hand, the Federal Reserve noted “improvements in the U.S. economy, adopting a more cautious approach regarding possible future cuts.”

On Wednesday, January 28, the Federal Open Market Committee (FOMC) voted 10 to 2 to maintain the federal funds rate in a range of 3.5 % to 3.75 %.

In a statement released by the U.S. central bank after the meeting, officials said that job growth has remained weak, and the unemployment rate has shown some signs of stabilizing.

The Fed’s assessment of the economy points to solid growth, a departure from the moderate outlook adopted last October. The central bank’s moderate language also avoided mentioning high inflation, reinforcing the idea of ​​a more balanced economy.

M.Pino

Source: roadshow

(Reference image source: Logan Voss on Unsplash)

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La entrada The Fed keeps rates current without short-term cuts expectations apareció primero en Bitfinance.

The Federal Reserve (Fed) has made it clear that it will not cut interest rates until it is certain that inflation is falling sustainably towards the 2% target, according to the minutes of its last meeting held at the end of January and published on February 21.

Members of the Federal Open Market Committee (FOMC), also known as the FOMC, unanimously agreed that it would not be appropriate to cut rates until they had greater confidence that inflation was moving sustainably towards 2%.

At the meeting of the US regulator on 30 and 31 January, it was decided to keep the rates in the range of 5.25% to 5.5%, the highest level since 2001. FOMC members discussed inflation and noted that although prices had declined over the past year, they remain concerned. They will therefore carefully evaluate incoming economic data to determine whether inflation is declining in a sustainable manner.

On February 13, it was reported that the inflation rate in the United States fell again in January, after having risen in December, and fell three-tenths to 3.1%. Underlying inflation, a key figure that the Federal Reserve analyzes for making interest-rate decisions, remained at 3.9% year-on-year.

In short, the Fed is closely monitoring inflation and commits to returning it to the 2% target, but only when it is certain that the trend is sustainable.

K. Tovar

Source: Diario Las Américas

(Reference image source: @Themoneypost_, X)

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La entrada The Fed will not cut interest rates for the time being apareció primero en Bitfinance.

The Federal Open Market Committee (FOMC) of the US Federal Reserve discussed the possibility of lowering interest rates in 2024, but stressed the need to maintain a restrictive stance to control inflation, according to the minutes of its December 12-13 meeting.

FOMC members estimated that the reference rate had probably peaked in the current monetary tightening cycle. However, they cautioned that future adjustments would depend on economic developments.

The issuing institute emphasized the importance of a data-based approach and caution in setting monetary policy. He reiterated that the strategy should remain restrictive until inflation was aligned with the 2 per cent target.

Fed officials considered that the current monetary policy was curbing economic activity and inflation, but also acknowledged that the economy might require a further increase in the target range.

All members of the FOMC agreed that “clear progress” had been made in reducing inflation by 2023, and most saw that inflation risks were balancing out.

However, some members expressed concern about the “uncertainty” of maintaining an overly restrictive policy. Based on the December macroeconomic projections, almost all participants anticipated that interest rates in 2024 would close below the current target range of 5.25% to 5.5%.

K. Tovar

Source: Idealista

(Reference image source: @FJRL65, x)

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La entrada The Federal Reserve could cut interest rates again apareció primero en Bitfinance.