The US central bank, the Federal Reserve, has left its key interest rate unchanged at a range of 4.25 to 4.5 percent. The Fed announced this on Wednesday. The decision was widely expected and investors will once again focus on the justifications. “Despite fluctuations in net exports affecting the data, recent indicators suggest that economic activity continues to develop at a solid pace” it said. The unemployment rate has stabilized at a low level in recent months and labor market conditions remain solid. “Inflation remains slightly elevated.” The Fed is still committed to achieving maximum employment in the long term and an inflation rate of 2 percent. “Uncertainty about economic prospects has continued to increase. The Committee is attentive to risks on both sides of its dual mandate and believes that risks to higher unemployment and higher inflation have risen” it said. Therefore, the key interest rate will not be changed. In assessing the magnitude and timing of any further adjustments, the Committee will carefully evaluate incoming data, evolving outlooks and the balance of risks. “The Committee is committed to reducing inflation back to its 2 percent objective” the Fed said.
US Central Bank Keeps Interest Rate Unchanged, Inflation Remains Elevated.
