The Federal Reserve (Fed) of the United States maintained its interest rate in a unanimous decision without changes, in the range of 0 to 0.25%, in which it has been for more than a year.
The Fed pointed out that he was probably the interest rates in the United States in March and confirmed its plans to close its bond purchases the same month before launching a significant reduction in its asset portfolio.
The combined measurements will be a turn away from the completed monetary policy expansion that defined the era of the pandemic and is heading for a more urgent struggle against inflation.
“With inflation well above 2% and a strong labor market, the Committee expects that it will soon be appropriate to increase the target band for the federal fund rate,” the US Federal Reserve’s Federal Open Committee said. in a statement.
The Fed also said committee members had agreed on a set of principles to “significantly reduce” the size of its asset portfolio by limiting the amount of the principal amount of bonds that expire, which it will reinvest each month.
The plan will begin after the interest rate hike, the Fed said, without setting another specific date.
The Fed cited “solid” recent job gains, even as variants erupt Omicron has taken the number of daily Covid-19 cases to record levels, saying it still hopes improvements in global supply chains will curb inflation.
In the weeks since the Fed’s monetary policy meeting on December 14-15, other risks have emerged, including Western fears of a possible Russian invasion of Ukraine and investors selling shares.
Monetary policymakers did not release new economic and interest rate projections on Wednesday.
At a news conference scheduled for 1:30 p.m. Wednesday, Fed Chairman Jerome Powell is expected to continue to align the central bank with the public and market expectations that he will act more aggressively to moderate interest rate hikes. consumer prices rising 7% per year, the highest level since the 1980s.
Reference-www.eleconomista.com.mx