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Slower US growth means no rate rise for 2019, says Fed

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US Federal Reserve chairman Jerome Powell

The US Federal Reserve does not expect to raise interest rates for the rest of 2019 amid slower economic growth.

After a two-day meeting, monetary policymakers voted unanimously to keep the US interest rate range between 2.25%-2.5%.

Fed members changed their outlook for 2019 from the two increases predicted in December to no movement.

The central bank warned that “growth of economic activity has slowed from its solid rate in the fourth quarter”.

It said: “Recent indicators point to slower growth of household spending and business fixed investment in the first quarter.”

The Nasdaq turned positive, up 0.35% at 7,750.7 points, while the Dow Jones Industrial Average and the S&P 500 trimmed earlier falls.

Analysis of the so-called “dot plot – where members of the Fed’s Federal Open Market Committee indicate where they expect interest rates to move to – also revealed that they anticipate only one increase in 2020.

The Fed also said that is will slow the monthly reduction of US Treasury bonds it holds from $30bn to $15bn from May onwards ending in September.

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