North America’s central bank announced on Wednesday that it had decided to leave its benchmark interest rate unchanged at a range of 5.25% to 5.50% for the fifth time in a row.
The decision by the Federal Reserve System (Fed) was announced in a statement following a two-day monetary policy meeting.
Fed members noted that the forecast of three rate cuts through 2024 remains in place, despite the most recent data showing inflation has accelerated slightly.
The CPI inflation index showed a rise in inflation in February to 3.2% compared to 3.1% in the previous month.
The Fed began raising interest rates in March 2022 to combat high inflation, leaving the federal funds rate between 5.25% and 5.50% as of July 2023, the highest level in more than 20 years.
“The latest indicators suggest that economic activity is expanding at a strong pace. Employment growth remains strong and the unemployment rate remains low. Inflation has fallen over the past year but remains high,” it said.
The Fed remains “firmly committed” to bringing inflation to its 2% target.
The gross domestic product (GDP) growth forecast for this year has been revised upward to 2.1% from 1.4%.
The inflation forecast for 2024 remains at 2.4%, as predicted three months ago.
Author: Lusa
Source: CM Jornal
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