The US Federal Reserve has decided to keep interest rates at their 23-year high due to ongoing concerns about inflation. This was announced by the central bank, which stated that the benchmark lending rate would remain at 5.25-5.50 percent. Despite some cooling in the Fed’s preferred inflation index from its peak in 2022, inflation remains above the target at 2.7 percent.
Fed Chair Jerome Powell stated that inflation was still too high and that rate cuts would not be considered until there was greater confidence that price growth was moving towards the 2 percent target. Powell emphasized that the Fed was prepared to keep the current interest rate for as long as necessary.
In response to this decision, US stocks initially rallied but ended mostly down as investors processed the news. The S&P 500 saw a significant increase before closing with a slight decrease, while international markets like London’s FTSE 100 and Japan’s Nikkei 225 also experienced fluctuations in response to the Fed’s decision.
