Wednesday 07/May/2025 – 09:15 PM
The US Federal Reserve, in a statement issued by the Federal Open Market Committee, revealed the reasons for its decision to keep interest rates unchanged for the third time in a row.
American federal: inflation rates are still high
The US Central Bank explained that despite the impact of net export fluctuations on economic data, modern indicators still indicate the continued growth of economic activity at a strong pace, and the unemployment rate has stabilized at a low level in recent months, and the conditions of the labor market remained stable in general, however, inflation rates are still a little high.
Increased uncertainty surrounding economic expectations
The statement pointed out that the committee is striving to achieve its main goals in the long term, which are the maximum amount of employment and the maintenance of an inflation rate at the level of 2%, noting that the state of uncertainty surrounding economic expectations has increased recently.
The committee confirmed that it pays great attention to the dangers facing these two double goals, and that it believes that the risk of high unemployment and inflation rates has already increased.
In support of its stated goals, the committee decided to keep the target scale for the interest rate on federal funds at a level ranging from 4.5% and 4.5%.
Lower bond holding
The federal pointed out that when studying the size and timing of any additional adjustments on the target of the interest rate of federal funds in the future, the committee will accurately hold the economic data received, future expectations of the economy, and the balance of potential risks, as the committee will also continue to reduce its possessions of US Treasury bonds, government agencies, and mortgage -backed securities.
The federal renewed its firm commitment to supporting the maximum amount of employment in the American economy, and to restore inflation rates to its specified goal at 2%.
In its evaluation of the appropriate position for monetary policy, the committee affirmed that it will continue to monitor the repercussions of the information contained in future economic expectations, and will be fully prepared to amend the position of monetary policy as necessary if any risks may hinder the achievement of its economic goals.
The committee stressed that its assessments will take into account a wide range of economic information, including readings related to the conditions of the labor market, the pressure of inflation and its future expectations, in addition to financial and international developments.
