Fed keeps rate at 5.25%-5.5% for fourth meeting in a row
Thus, the institution again kept its monetary policy unchanged for the fourth consecutive meeting after the last 25 basis point increase in the price of money carried out in July last year. “The committee will continue to carefully evaluate incoming information, the changing environment and the balance of risks,” the central bank said. Likewise, the decision-maker indicated that it “does not expect it would be appropriate to reduce the target range until it has greater confidence that inflation is returning sustainably to 2%.”
While assessing the appropriate monetary policy stance, the committee assured that it will continue to monitor the impact of incoming data on the macroeconomic picture.
GDP, UNEMPLOYMENT AND INFLATION
According to the Bureau of Economic Analysis (BEA), the economy of the world’s leading power posted annual growth of 4.9% of GDP in the third quarter of 2023, up from 2.1% in the previous quarter. The U.S. labor market added 199,000 nonfarm payroll jobs in November, pushing unemployment down two-tenths to 3.7%, according to the Labor Department’s Bureau of Labor Statistics. Thus, the US unemployment rate again approached the low recorded in January and April, when it reached 3.4%, which was the lowest level since 1969. Meanwhile, the consumer price index for personal consumption, the Fed’s inflation-control variable of choice, was 2.6% annualized in December, the same rate as the previous month. The monthly rate recorded a rebound to 0.2% from the previous negative level of 0.1%. The benchmark closed at 2.9%, down three-tenths.
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