The US Federal Reserve System (FRS), which acts as the country’s central bank, kept the rate at the level of 0-0.25% per annum, as expected by the market. This is stated in the message of the financial regulator on July 29.
“The ongoing public health crisis will significantly affect economic activity, employment and inflation in the short term and pose significant risks to the economic outlook in the medium term. In light of these events, the committee decided to maintain the target range of the federal funds rate at the level of 0-0.25% per annum, ”the statement says.
The coronavirus pandemic will seriously affect the American economy in the short term, the regulator noted.
The Fed believes that after the slump, economic activity and employment have increased slightly in recent months, but remain well below their levels at the beginning of the year. “Weaker demand and significantly lower oil prices are holding back consumer price inflation,” the website says. However, it is clarified that general financial conditions have improved in recent months.
On June 10, the Fed also decided to keep the federal funds rate at the level of 0 to 0.25%.