Monday , September 26 2022

The US Federal Reserve expects the interest rates to remain unchanged, as expected


VASHINGTON (Reuters) – The federal committee of the Federal Open Market Committee (FOMC), which was held until August 8, will maintain the target interest rate of the federal fund (FF) at the level of 2,00 to 2,25%. Unanimously decided.

On November 8, the Federal Reserve unanimously decided to maintain the target interest rate of the federal fund from 2.00 to 2.25% in the Federal Open Market Committee (FOMC). The picture is FRB headquarters in Washington. August Shooting (2018 Reuters / Chris Vattie)

The Fed said in a statement: "The labor market continues to tighten, economic activity is expanding rapidly." The strong growth in employment and consumer spending has shown that the economy is not out of the orbit, keeping the stance to continue with a moderate increase in interest rates.

However, there was also a recognition that investment in the company has become moderate at a fast pace since this year.

Policy change is expected. The Fed has increased interest rates three times since this year's entry and many feel that it will move in December to increase the rate in the next FOMC.

In the United States, the inflation rate was around 2% targeted by the Fed, and the unemployment rate has fallen. Although the risk to the economy seems to be mostly in balance, this statement shows that FRG's attitude to the economy has not changed much since the FOMC last September.

Given the signs of weakening in October and signs of housing and corporate investment recession, some analysts also said the Fed would propose a skeptical view of the next increase in the rate.

However, it seems that the increase in the rate in December is still safe.

Mr. Boris Shoresburg, general manager of the strategy for foreign exchange strategy BK Asset Management (New York), said: "If it creates something unexpected, it was not a hysterical thing." The language of corporate investment has become "more moderate" than it ever was, as which is a text that is pushed as it was before, but the Fed also does not show any warning signals. "

The preliminary figures for the gross domestic product (GDP) for the third and fourth quarters, announced by the Ministry of Commerce at the end of the previous month, increased by 3.5% annually. In addition to the Fed, it has surpassed almost 2%, which many economists consider a basic trend.

However, Fed officials have begun to discuss whether the US economy has reached its peak, while the impact of tax cuts on the administration of the Trump administration and the expansion of spending measures has been reduced.

In this statement, there was no clear consideration of the volatility of the US stock market and the possibility of global economic slowdown next year.

No new economic prospects will be announced in this FOMC, and a press conference by the President of the Federal Union of the Federal Ministry of Finance is scheduled.

* Content added.

Our Code of Conduct:Thomson Reuters "principle of trust"
Source link