US Fed leaves interest rates unchanged

The US Federal Reserve left the benchmark interest rate unchanged in the range between 0-0.25%
The US Federal Reserve left the benchmark interest rate unchanged in the range between 0-0.25%
The US Federal Reserve left the benchmark interest rate unchanged in the range between 0-0.25%

The US Federal Reserve left the benchmark interest rate unchanged in the range between 0-0.25% at its meeting on January 26. In a statement, however, the Fed indicated it could soon increase interest rates, in response to a strong labour market and the high inflation rate in the country. The institution also announced that it will continue to reduce the pace of its asset purchasing programme – created to tackle the COVID crisis – to USD 30bn in February 2022, indicating that the programme could end in March. 

The US Federal Reserve left the benchmark interest rate unchanged in the range between 0-0.25%

Inflation in the United States continued to rise in the last month of 2021, as the country’s economy is suffering from high demand coupled with constrained supply, caused by the global supply chain blockages. The consumer price index increased to 7% y/y in December from the 6.8% in the previous month. This is the highest reading since February 1982 and the seventh consecutive month of consumer inflation over 5%. On a monthly basis, CPI increased by 0.5% seasonally adjusted, down from 0.8% in November. Core inflation, which excludes food and energy prices, increased by 5.5% y/y and 0.6% m/m seasonally adjusted. Read more about the US inflation.

The seasonally adjusted unemployment rate in the United States dropped to 3.9% in December 2021, the lowest since the start of the COVID-19 pandemic in February 2020. Compared to November 2021 the unemployment rate decreased by 0.3 pp and on an annual basis it decreased by 2.8 pp. Read more about the US job market.

The US lower federal funds rate is updated daily, available from 16/12/2008 to 27/01/2022. The data reached an all-time high of 2.25 % pa on 31/07/2019 and a record low of 0 % pa on 27/01/2022.

Further data and analysis on the US economy are available on the CEIC US Economy in a Snapshot – Q4 2021 report.

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27th January 2022 US Fed leaves interest rates unchanged