US Federal Reserve holds interest rates steady

The U.S. Federal Reserve (Fed) skipped an interest rate hike Wednesday and kept its federal funds rate unchanged between the 5.25% and 5.5% target range.

"In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks," Federal Open Market Committee (FOMC) said in a statement.

However, the FOMC also added that inflation has eased over the past year.

The decision to keep rates unchanged was unanimous, as all 12 members of the committee voted in favor of the move.

While it is the Fed's fifth interest rate skip in a row, after June, September, and November, the federal funds rate remains at its highest in 23 years. The bank last raised its rate by 25 basis points on July 26.

The central bank raised rates by 525 basis points in 11 meetings from March 2022 to July 2023 to combat record inflation, which climbed to its highest level in more than 40 years last summer.

After soaring to 9.1% last June, annual consumer inflation dropped to 3.2% in February.

Source: AA