FED Announced Its Interest Rate Decision

FED announced its interest rate decision. The US Federal Reserve (FED) did not change the interest rate, leaving it constant in the range of 0-0.25 percent.

Following the April meeting of the Federal Open Market Committee (FOMC), the US Federal Reserve (FED) decided not to change the federal funding rate in line with the expectations of the markets and unanimously kept the federal funding rate stable in the range of 0-0.25 percent. In the statement made by the FED, it was noted that the monthly asset purchase program of at least $ 120 billion will be continued. In the statement, which drew attention to the strengthening of economic activity and employment, it was also stated that the rise in inflation largely reflected temporary factors. FED said, "Inflation has risen, mostly reflecting temporary factors. Asset purchases will continue until significant progress is achieved in the targets. We are determined to use all the tools we have to support the economy, financial conditions remain supportive." Making a statement after the meeting, FED Chairman Jerome Powell said, "With our verbal guidance, our policy will continue to support the economy." Powell made the following statements: "The sectors most affected by the pandemic have recovered. The economic recovery is unstable and far from recovering. Spending on the service sector has increased. The economy is far from its targets. The economy will rise partially before inflation eases. Unemployment remains high. Temporary rise in inflation does not require a rise in interest rates. Twelve-month inflation readings are expected to exceed 2 percent. Controlling the epidemic is the most important factor for controlled recovery. Interest rates will remain close to zero until targets are reached. Spending will likely cause a temporary rise in prices. It is not yet the right time to talk about the reduction of bond purchases. We focus on economic outcomes depending on the situation. Real estate prices are strong, demand is increasing due to insufficient supply. We are worried about the permanent damage the covid crisis will leave in the employment market. If inflation expectations reach above 2 percent, the Fed will use the tools at its disposal. You can be sure that the Fed will act to contain inflation. We should see more employment reports like in March. We have a hard time understanding digital currencies very well. It doesn't worry me that other countries used digital currency before the US. China's digital currency will not be used in the US. Inflation expectations are now where they are in 2018. It is difficult to predict how long the bottlenecks will last. We haven't seen wages go up yet. "