The Federal Reserve (FED) has chosen to maintain its current interest rates, but the statements accompanying this decision are crucial. Despite keeping rates steady, the FED’s tone in its published statements leaned towards a more hawkish stance.
Key points from the FED’s statements include:
– The FED has kept the overnight interest rate within the range of 5.25-5.50% and anticipates only one rate cut in 2024.
– While acknowledging “modest progress” towards the 2% inflation target, the FED remains cautious and hesitant to lower its policy target range until more confidence is gained in inflation sustainably moving towards 2%.
– The economy is showing solid growth, with strong employment and low unemployment rates.
– Inflation has decreased from the previous year but remains high.
– The FED plans to continue reducing its holdings of Treasury securities and mortgage-backed securities.
According to FED projections, 4 out of 19 officials do not foresee any rate cuts in 2024, while 7 predict one cut and 8 predict two cuts. This decision has had an impact on various assets, including Bitcoin.
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