If the economy keeps going in the same direction, Federal Reserve Chairman Jerome Powell stated that a reduction in the bank’s benchmark rate “may be on the table” at the next meeting in September.
He claimed that although officials discussed taking this action at their meeting this week, they ultimately opted to wait for additional proof that price increases are leveling off.
The move upheld the Federal Reserve’s target range for the key rate, which has been stuck between 5.5% and 5.25% since July.
The Fed has been attempting to calm the economy by maintaining high borrowing costs.
However, the bank is under increasing pressure to lower its rates, which are at a 23-year high, as it fears that if it waits too long to act, a slowdown might grow into a more severe economic collapse.
Many central banks around the world are faced with comparable decisions; therefore, their actions are being closely observed.
The Bank of Canada and the European Central Bank are two of the banks that have already announced rate reductions. Regarding what the Bank of England will do at its own meeting this week, investors are split.
