U.S. Fed holds rates near zero

U.S. Fed holds rates near zero

The U.S. Federal Reserve on Wednesday held its benchmark interest rate near zero and said the economy continues to progress despite concerns over the pandemic spread.

As expected, the Federal Open Market Committee concluded its two-day meeting by keeping interest rates in a target range between zero and 0.25%.

Along with that, the committee said in a unanimously approved statement that the economy continues to “strengthen,” CNBC reported.

Despite the optimism about the economy, Chairman Jerome Powell said the Fed is nowhere near considering a rate hike. “Our approach here has been to be as transparent as we can. We have not reached substantial further progress yet,” he said. “We see ourselves having some ground to cover to get there.”

“Substantial further progress” on inflation and employment is the benchmark the Fed has set before it will tighten policy, which would mean slowing and ultimately stopping monthly bond purchases and ultimately raising interest rates.. The statement noted only that “progress” has been made, and the FOMC will continue to watch conditions to see how close they get to the Fed’s goals.

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