The Fed left rates unchanged. Close expected in December – The Republic

MILAN The central bank of the Usa haa, as expected, left rates unchanged at 0,25-0,5% for the seventh consecutive time. The announced at the end of the meeting, which began yesterday, the Federal open market committee i.e. the arm of the monetary policy of the american central bank. The last time the cost of money is changed is the state in December 2015. On that occasion, the Fed announced the first monetary tightening since June 2006, thus starting the normalization of its monetary policy accommodative. The rise in interest rates – up to then still at the historic low to which were taken in December 2008 in the wake of the worst financial crisis since the ’30s of t he last century – was of 25 basis points. The Fed’s decision to leave interest rates unchanged, however, was not taken unanimously. Esther George and Loretta Mester voted against, preferring a rise in rates of interest.

The Federal Reserve has decided “for now” to keep rates unchanged in anticipation of “further signs of progress” but “believes that the opportunity of increasing, has continued to strengthen”. And’ what we read in the press release issued at the end of the board, according to which, from the summit of last September, “the labor market continued to strengthen and the growth of economic activity has accelerated from the pace modest recorded in the first half”. It is, therefore, most probable, in the light of these words, that on the occasion of the December meeting, the Fed increases the cost of money, bringing it to 0.75%. The chance of a rise in rates
of interest by the Fed in December rose to 78% after the meeting. And’ what emerges from the trend of Fed Funds.

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