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The federal reserve has left the American interest rates commenting, and indicated that it does not push for controlling monetary policy, and challenged pressure from President Donald Trump for deep discounts in borrowing costs.
The central bank kept the main Wednesday interest rate In 4.25-4.5 percent and indicated that he was now on a temporary stop, as Federal Reserve Chairman Jay Powell said that US price lists “do not need to be in a hurry to control our position on politics.”
The decision was unanimously a few days after Trump insisted that borrowing costs must decrease “a lot” and pledged to “allow her to be known” if he did not agree to the central bank’s decision.
the Federal Open Market CommitteeIn its decision, the Central Bank Policy Committee said that the American inflation remained “somewhat high” and removed a previous reference indicating “progress” towards achieving its 2 % goal. Powell later explained that the changes reflect a “cleaning exercise” rather than a shift in politics.
Sarah House, senior economists in Wales Vargo, said the Federal Reserve statement “tends to be somewhat honest.” “This is the federal reserve bank less concerned about the status of the labor market.”
The pause of three consecutive discounts-a step of 0.5 percentage in September-which fell in the target range of federal funds from 23 to 5.25-5.5 per cent.
Powell pointed out that interest rates will remain suspended so that FOMC has more time to assess how Trump pledges to raise commercial barriers, cutting and slavery taxes, and carry out mass deportations that would affect its efforts to cool inflation.
The President of the Federal Reserve said that the new administration policies are “we cannot criticize, or praise.”
He also refused to respond to Trump's calls to the Federal Reserve to significantly reduce borrowing costs, saying that he “will not have any response or comment to what the president said.”
“This average decision, which was truly the only option to implement the federal reserve in this junction, would lead to political pressure,” said Eswar Barasad, a professor at Cornell University. “The coming months will be unusually difficult for the Federal Reserve, if inflation remains sticky above its target level, even when Trump accumulates severe pressure to reduce prices and reduce borrowing costs.”
The American markets have been widely taken by the Federal Reserve's decision, as government bonds were subjected to moderate sale.
The revenue of the policy sensitive for a period of two years reached 0.03 degrees Celsius, 4.23 percent higher by late afternoon in New York, while the 10 -year standard return was flat at 4.55 percent. High return with low prices.
In stock markets, S&P 500 was 0.5 percent less. The heavy nasdaq boat in technology decreased by a similar margin, after pruning some of its losses during the Powell press conference.
