The Federal Reserve left today, Sept. 20, interest rates unchanged at their highest level since 2001, as widely expected.
In its two-day meeting, the the Federal Open Market Committee (FOMC) maintained policy rates at the current range of 5.25%-5.50%.
The Fed also upgraded its view of the economy, saying it has been expanding at a “solid” pace compared to its prior description of a “moderate” pace. It noted that “job gains have slowed in recent months but remain strong.”
In a statement after the meeting, the US central bank added that FOMC will continue to reduce its holdings of treasury bills and mortgage-backed securities (MBS), as planned, with a high commitment to return inflation to 2%.
This the second meeting at which the Fed has not raised its federal funds rate since it began its hiking campaign in March 2022. Interest rates were held in June amid increasing uncertainty about the impact of the banking system crisis on lending.
Investors watch the detailed Fed minutes, which includes the vision of policymakers for key indicators, such as the gross domestic product, inflation, unemployment and interest rate forecasts.
Markets will be listening closely to Fed Chair Jerome Powell's press conference later today. Policymakers are expected to meet again in November and December 2023.