FRS has kept the key rate in the range of 4.25-4.5%

The US Federal Reserve System (FRS) has kept the federal funds rate in the range of 4.25-4.5% per annum. This is stated in the report of the Federal Open Market Committee (FOMC).

As noted, recent indicators show that economic activity continues to develop at a steady pace. The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain stable. Inflation remains slightly elevated.

The FRS has reaffirmed its intention to achieve maximum employment and bring inflation back to its 2% target.

In considering the amount and timing of additional adjustments to the target range, the statement said, the FOMC will carefully evaluate incoming data, evolving forecasts, and the balance of risks.

FRS Chairman Jerome Powell said that he would not rush to cut rates until inflation and employment data make it appropriate, Reuters reports.
He noted that he believes the policy of the department is very balanced.

This decision and Powell’s subsequent comments, the agency notes, put the FRS’ policy on hold. The U.S. economic landscape is currently both stable and extremely unclear, with a healthy set of macroeconomic fundamentals but uncertainty about the Trump administration’s future decisions on immigration, tariffs, taxes, etc.

Last December, the FRS cut its key policy rate by 25 basis points to 4.25-4.5% per annum. The regulator cut the rate at three consecutive meetings.