The U.S. Federal Reserve on Wednesday held its benchmark lending rate steady, but indicated that it may increase the rate later this year with the aim of achieving maximum employment and keeping inflation at a 2 percent target.
The two-day rate-setting Federal Open Market Committee (FOMC) decided to keep the rate between 5.25 percent and 5.50 percent, the same as in July when it was raised by a quarter percentage point.
The decision marks the second pause in the Fed’s rate-hiking campaign, which began in March last year, allowing policymakers to assess the impact of the previous hikes.
The Fed stated that “recent indicators suggest that economic activity has been expanding at a solid pace” and that “the unemployment rate has remained low,” pointing to the overall health of the economy.
At a press conference, Fed chair Jerome Powell hinted at the possibility of another rate hike in the future, saying, “We are prepared to raise rates further if appropriate, and we intend to hold policy at a restrictive level until we are confident that inflation is moving down sustainably toward our objectives.”
The latest rate decision resulted in a gap between the key rates of South Korea and the United States of up to 2.0 percentage points.
This file photo, taken March 13, 2015, shows the Federal Reserve's headquarters in Washington, D.C. (Yonhap)
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