The US Federal Reserve keeps interest rates unchanged and continues its monetary policy

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he decided US Federal Reserve BoardYesterday, interest rates were kept unchanged in the range from zero to 0.25% while continuing with its expansionary monetary policy, CNBC Arabia reported.

وقال Jerome Powell The Federal Reserve Chairman, that the Fed may conclude reducing its purchases of… bond By the middle of next year.

Powell’s comments came at a press conference following the publication of the latest monetary policy statement from the Federal Reserve, which said that “moderation in the pace of asset purchases may be justified soon”, but did not include any indication of how long that process might take.

The Federal Reserve buys $120 billion a month in Treasuries and mortgage-backed securities to support the recovery of the world’s largest economy from the Corona virus pandemic.

The Fed cleared the way to scale back its monthly bond purchases “soon” and indicated that rate increases could follow at a faster pace than expected, with the 18 members of the US central bank’s monetary policy-making committee speculating that borrowing costs would be needed in the coming months. 2022.

These measures, which are included in the latest monetary policy statement from the Fed and separate economic forecasts, represent a tendency towards tightening from a central bank that expects inflation to run at 4.2 percent this year, or more than twice its target level, and is preparing itself to move against it.

The move may proceed slowly with interest rates expected to rise to 1 percent in 2023, faster than the pace projected by the Fed in June, and then to 1.8 percent in 2024, which will still be considered an accommodative stance for monetary policy.

Despite acknowledging that the new jump in Corona infections slowed the recovery of some parts of the economy, the Open Market Committee, the monetary policy maker of the Federal Reserve, said in a unanimous statement that the indicators as a whole “increased strength.”

It added that if progress “continues in general as expected, the Committee assesses that a moderation in the pace of asset purchases may be warranted shortly.”





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