Washington, Dec. 13 (EFE).- The United States Federal Reserve announced Wednesday a new pause in raising interest rates, the third consecutive pause after the eleven increases it has made since March 2022.
The US central bank decided to keep interest rates at their current range of 5.25% to 5.5%, the highest level since 2001, and stressed that its Federal Open Market Committee (FOMC) will continue to evaluate additional economic information and its implications for economic policy.
The FOMC is the body responsible for deciding whether or not to raise interest rates.
In a statement, it said that in determining the extent of additional tightening to return inflation to 2%, “the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments.”
The FOMC maintained that it is “strongly committed” to bringing inflation to this 2% objective and expressed its willingness to adjust the stance of monetary policy as appropriate if risks arise that could impede the achievement of this objective.
The committee issued its statement minutes before Fed Chairman Jerome Powell is scheduled to hold a press conference to explain the decision.
Until June of this year, committee members voted to raise rates at every meeting since the series of increases began. After the June pause, they hiked again in July and decided to pause again in September.
The Fed began its final meeting of 2023 on Tuesday, the same day it announced that US inflation has continued to moderate, with the year-over-year rate standing at 3.1% in November, down one-tenth from October.
The FOMC noted that it has moderated over the past year “but remains elevated.”
The underlying inflation rate, which measures the rise in prices excluding energy and food (and is one of the indicators the Fed monitors most closely in its decisions), rose three-tenths on a monthly basis in November to 4% on an annual basis.
As for the labor market, another key data analyzed by the Fed to examine possible increases, the net creation of new jobs rose again in November and 199,000 new jobs were created, 49,000 more than the previous month. EFE
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