The Federal Reserve System (FRS) maintains the federal funds rate in the range of 0% to 0.25% per year.This is Bulletin After the Federal Open Market Committee (FOMC) meets on March 16-17.
The Fed said it will continue to repurchase a total of $120 billion in assets each month, including $80 billion in U.S. Treasury bonds and $40 billion in mortgage bonds.
The dot chart released at the end of the meeting-a chart reflecting the personal expectations of the Federal Reserve Board of Governors and Federal Reserve Bank (FRB) leaders on interest rates-shows that all 18 leaders of the U.S. Central Bank expect the benchmark interest rate to be in 2021 Stay within the current range (0-0.25%). Four of them believe that interest rates may increase in 2022, and seven of them are already waiting for an interest rate hike in 2023.
The median forecast by Fed executives shows that the interest rate will remain within the current range until the end of 2023, and will rise to 2.5% in the long run.
In a statement issued at the end of the meeting, the Fed confirmed its readiness to use all available tools to support the U.S. economy during “this difficult time”, thereby moving towards achieving maximum employment and price targets. stable.
The report says that the COVID-19 pandemic has caused huge human and economic difficulties in the United States and the world. However, if the central bank talked about a slowdown in economic activity in January, it is now noticing that economic activity and employment indicators have improved in recent years, “although the sectors most affected by the pandemic are still weak.” “Interfax”.
The statement said: “Inflation is still below 2%. Overall, financial conditions remain favorable, partly because of the Federal Reserve’s actions to support the economy and the flow of loans to American households and businesses.”
The FOMC pointed out that the further development of the economy will depend to a large extent on the development of the epidemiological situation in the United States, including the progress of vaccination. According to the Federal Reserve, the ongoing pandemic crisis has put pressure on the country’s economic activities, employment and inflation, and brought serious risks to the economy.
“The Federal Open Market Committee is committed to achieving the maximum employment rate and an inflation rate of 2% in the long-term. Since the inflation rate is always lower than the long-term target, the committee will strive to make the inflation rate moderately above 2% for a period of time. On average, 2%, Long-term inflation expectations are clearly fixed at 2%,” the document said.
The committee plans to maintain a stimulative monetary policy until these goals are achieved.
The Federal Open Market Committee decided to maintain the federal funds rate within the target range of 0-0.25%, and believed that “as long as the conditions of the US labor market do not conform to the Fed’s concept of full employment” will be appropriate. 2%. At the same time, the rate of increase in consumer prices may exceed 2% within a period of time.
After the results of the Federal Reserve meeting were announced, the Dow Jones stock index rose 0.4%, the S&P 500 index and the Nasdaq index fell 0.1% and 0.4%, respectively. The dollar exchange rate against the euro fell by nearly 0.5% to $1.1958. The US 10-year US Treasury bond yield was 1.657%, slightly higher than the level of the previous trading day.