The US Federal Reserve (Fed) has kept the benchmark interest rate at its highest level in 22 years for the second consecutive time.
On November 1st, in line with market expectations, the Fed decided not to raise interest rates following a two-day policy meeting. The current benchmark interest rate in the US stands at around 5.25-5.5%, the highest in 22 years. The agency also refrained from increasing the rate back in September.
In its statement after the meeting yesterday, the Fed noted that “economic activity has grown at a solid pace in the third quarter.” Despite the Fed raising rates 11 times since March 2022 to curb inflation, the US economy has not slumped.
This has contributed to the recent increase in the yields of US government bonds, approaching the 5% mark. During the press conference following the meeting, Fed Chair Jerome Powell stated that they would closely monitor this development as it “could impact interest rate decisions in the future.”