The US Central Bank, the Federal Reserve makes the benchmark interest rate unchanged and blows increases for this year. The guardian of the currency to the Fed-chief Jerome Powell kept the monetary policy key rate on Wednesday in the range of 2.25 to 2.5 percent.
At the same time, it signalled in its updated Outlook, 2019 will be added to the top. Only in 2020 will probably follow an increase. Many traders had established themselves due to the uncertain economic Outlook, 2019 no increase is more to come. The Fed had announced at the time of their most recent increase, in December, two more steps to the top for 2019.
So, the Fed is continuing on its cautious course. Central Bank chief Powell had declared in January, due to unclear economic data and patience in the monetary policy was announced. US President, Donald Trump had called on the Central Bank previously on several occasions, no further interest rate hikes to the economy stalling.
At the same time, Powell is insured, he can see there is currently no financial risks, which could cause a crisis. Viewed as a Whole, the "vulnerabilities of the financial stability would not be assessed as high". The Fed is watching but some of the developments on the financial markets with caution. That the Central Bank no longer speaks of an increase in the key rate this year, according to experts, an indication that a slowdown of the US economy expects.
relief on the US stock exchanges
The Fed has decided to leave the removal of their balance sheet up to September expiry, if the economy and conditions in the financial markets, until then, as expected. In the meantime, the Portfolio of the Fed in fighting the economic growing crisis through bond purchases to around 4.5 trillion dollars. Meanwhile, it was evaporated again to under four trillion dollars.
The largest economy in the world is impacted among other things by the trade conflict with China. Since the beginning of the dispute around a year ago, both countries were covered with punitive tariffs on Goods in a total value of more than 360 billion USD (318 billion euros). Both sides are currently discussing a way out.
The US stock markets were betting immediately after the interest rate decision losses. Both the S&P 500 Index, as well as the technology exchange, the Nasdaq returned to positive territory, after they had recorded the statement of Fed's losses.
Created: 20.03.2019, 20:27 PM