Consumer inflation has decreased from a year-over-year peak of 9.1% in June 2022 to 3.7%, but it remains well above the Federal Reserve’s 2% target.
The Federal Reserve announced on Wednesday its decision to maintain interest rates at the current levels for September.
However, it expressed intentions to implement an interest rate increase before the year’s end with the aim of reducing inflation from its current rate of over 3% to its desired target of 2% annually.
“The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run,” the US central bank said after a meeting of its Federal Open Market Committee, or FOMC.
“In support of these goals, the Committee decided to maintain the target range for the federal funds rate at 5-1/4 to 5-1/2 percent.”
Between February 2022 and July 2023, the Federal Reserve implemented 11 interest rate hikes, resulting in a cumulative increase of 5.25 percentage points from the initial base rate of 0.25%.
Source: Almayadeen