Home > Dynamic > Fed keeps interest r...

Fed keeps interest rates steady and signals no rate cuts for now

2024-02-01

306

The U.S. Federal Reserve concluded its two-day monetary policy meeting on January 31 and announced that it would keep the target range for the federal funds rate unchanged at 5.25% to 5.5% and hinted that it would not cut interest rates for the time being.

This is the fourth consecutive time the Fed has kept interest rates unchanged at this range. In a statement issued that day, the Federal Reserve said that recent indicators show that U.S. economic activity continues to expand steadily. Job growth has slowed since the start of 2023, but remains strong, and the unemployment rate remains low. Inflation levels have eased over the past year but remain elevated.

The statement emphasized that when considering any adjustments to the target range for the federal funds rate, the Federal Open Market Committee, which sets monetary policy, will carefully evaluate future data, the changing outlook and the balance of risks. "It would not be appropriate" to lower interest rates until there is greater confidence that inflation is sustainably moving towards the 2% target.

The statement also reiterated that the Fed will continue to monitor the impact of upcoming information on the economic outlook as it evaluates the appropriate stance of monetary policy. The Fed will be prepared to adjust the stance of monetary policy as appropriate if risks arise that could impede achievement of its goals.

Federal Reserve Chairman Powell said at a press conference after the meeting that day that the federal funds rate is likely to be at the peak of this tightening cycle. If the economy develops broadly as expected, the Fed will begin to adjust policy. But he also said that based on this meeting, the Federal Open Market Committee is "unlikely to reach a confidence level in March and determine that March is the time to take action (to cut interest rates)."

Most Fed officials expected late last year that if inflation continues to gradually decline and the economy grows steadily, the Fed may cut interest rates three times in 2024, by 25 basis points each time. A tracking data from the Chicago Mercantile Exchange shows that as of press time, the market expects the probability that the Federal Reserve will maintain interest rates at its March meeting this year has risen to more than 60%.

The above information is provided by special analysts and is for reference only. CM Trade does not guarantee the accuracy, timeliness and completeness of the information content, so you should not place too much reliance on the information provided. CM Trade is not a company that provides financial advice, and only provides services of the nature of execution of orders. Readers are advised to seek relevant investment advice on their own. Please see our full disclaimer.

CM Trade

As a world leading financial trading platform, CMtrade Provides comprehensive one-stop trading services and opportunities for traders.

[Products]

The platform provides over 32 kinds of popular financial products such as forex, precious metals, crude oil, indices, cryptocurrencies and more.

[System]

2 top trading systems CM Trade MT4 / CM Trade APP, powerful and easy to operate

[Service]

Comprehensive market news, professional market analysis, 7*24 hours online customer service

[Advantage]

Low cost, high leverage, flexible one-stop all day two-way trading.

[Authority]

Licensed and strictly regulated by authorities. Traders deposits are independently kept by the bank. Fast deposit and withdrawal. Fair, efficient and transparent trading environment.

Free Access
Daily Trading Strategy Download Now

CM Trade Mobile Application

Economics Calendar

Fed keeps interest rates steady and signals no rate cuts for now

Access to global trading markets anytime and anywhere