US interest rates have been held for the fifth time in a row by the Federal Reserve. The decision, which was broadly expected, means rates remain between 3.5% and 3.75%.
Chairman of the Federal Reserve Kevin Warsh
Higher interest rates make borrowing more expensive for people wanting to secure loans, mortgages and credit cards, but can lead to better returns on savings.
Policymakers decided to keep rates at the level they have been all year after inflation, the rate at which prices rise, slowed last month. Despite the fall, inflation remains above the Fed's 2% target and uncertainty remains over the impact of the ongoing conflict in the Middle East on global oil prices and subsequently general consumer prices in the coming months.
What does the Fed’s decision mean?
The decision keeps US interest rates between 3.5% and 3.75%, a level that has remained unchanged all year. It was broadly expected by markets and policymakers.
Higher rates continue to make borrowing more expensive for loans, mortgages and credit cards, while savers may see better returns on deposits.
Why did policymakers keep rates unchanged?
Policymakers held rates after inflation slowed last month, but they noted that price growth remains above the Federal Reserve's 2% target. They also face uncertainty over how the ongoing conflict in the Middle East could affect global oil prices and, in turn, consumer prices in the coming months.
The Federal Reserve said the rate decision reflected current economic conditions, with inflation still a concern despite the recent slowdown.
What were the key figures?
The rate setting remains between 3.5% and 3.75%, and this is the fifth consecutive time the Federal Reserve has left interest rates unchanged.
Inflation slowed last month, but it is still above the Fed’s 2% target.
Concerns remain about the possible impact of the Middle East conflict on global oil prices and general consumer prices.
