No Surprises on Rates, But The Fed's Next Move Is Uncertain
By John Persinos
Wall Street hates surprises and on Wednesday it didn't get any from the Federal Reserve. As widely expected, the U.S. central bank kept interest rates on hold at 5.25% – 5.50%.
Now attention has shifted to when the Fed cuts rates. It's considered a given that the Fed will eventually loosen this year, but the unanswered question is timing.
In its official statement, the policy-making Federal Open Market Committee (FOMC) optimistically stated: "The Committee judges that the risks to achieving its employment and inflation goals are moving into better balance."
During his traditional post-meeting press conference, Fed Chair Jerome Powell offered clues as to what's next in terms of monetary policy.
"Inflation is still too high, ongoing progress in bringing it down is not assured and the path forward is uncertain," Powell said. "I want to assure the American people we are fully committed to returning inflation to our 2% goal."
Translation: The Fed's hold on rates is likely to last beyond the next FOMC meeting in March.
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