Federal Reserve keeps interest rates unchanged

The Federal Reserve is holding interest rates steady, for now.The unanimous statement by policy maker...

Posted: Aug 2, 2018 4:56 AM
Updated: Aug 2, 2018 4:56 AM

The Federal Reserve is holding interest rates steady, for now.

The unanimous statement by policy makers under Fed Chairman Jerome Powell came at end of a two-day meeting in Washington.

The decision had been expected, and the Fed indicated little deviation from its current plans to raise rates at least two more times this year, citing a solid economy with fewer Americans out of work. It has also penciled in three more rate hikes in 2019 in an effort to keep the economy from overheating.

"Job gains have been strong, on average, in recent months, and the unemployment rate has stayed low," according to the Federal Open Market Committee's statement. "Household spending and business fixed investment have grown strongly," it said.

The federal funds rate, which helps determine rates for mortgages, credit cards and other borrowing, remained at a range of 1.75% to 2%.

Related: US economy roars into high gear

The signal to stay on course comes amid public criticism by President Donald Trump of the Fed's decision to raise interest rates and escalating trade tensions between the United States and China.

The world's two largest trading partners are at an impasse in the trade spat, with both sides threatening new tariffs. Powell has said the trade tensions lend "considerable uncertainty" to the central bank's calculus.

"There's no precedent for these broad trade discussions," Powell told senators last month at a hearing. "It's hard to know how this is going to turn out."

The Fed chief has said lower tariffs could be a good thing for the US economy, while also noting that higher tariffs would not only "be bad for our economy" but others', too."

Related: JPMorgan CEO: US economy is 'strong and it's getting stronger'

The US economy is on solid ground. The unemployment rate is historically low, wage growth is starting to pick up and inflation is finally at the level the Fed considers healthy for the economy. The Fed has raised its key interest rate twice this year, most recently in June.

Policy makers kept to their overall forecast of the economy by once again saying, risks appear "roughly balanced." Central bankers will offer a more detailed economic forecast when they meet in September.

Powell in July offered a strong endorsement of the Fed's plan to keep raising rates this year. Investors have clung to two words uttered by the Fed Chair -- "for now" -- as a signal central bankers could pivot should the economic outlook become shaky.

Wall Street analysts anticipated this month's committee's statement wouldn't be dramatically different. Investors often search for hints to predict future plans by policy makers.

"There's not going to be a dramatic change in the statement because they don't want to commit themselves to accelerating the pace of rate increases, but they want to prepare markets for the possibility [of an additional rate hike]," said James Kahn, a former vice president of the Federal Reserve Bank of New York and economics professor at Yeshiva University.

Huntsville
Few Clouds
79° wxIcon
Hi: 80° Lo: 54°
Feels Like: 79°
Florence
Clear
79° wxIcon
Hi: 82° Lo: 56°
Feels Like: 79°
Fayetteville
Clear
75° wxIcon
Hi: 79° Lo: 52°
Feels Like: 75°
Decatur
Clear
78° wxIcon
Hi: 80° Lo: 53°
Feels Like: 79°
Scottsboro
Clear
79° wxIcon
Hi: 81° Lo: 56°
Feels Like: 80°
WAAY Radar
WAAY WAAY-TV Cam
WAAY Temperatures

Alabama Coronavirus Cases

Confirmed Cases: 17359

Reported Deaths: 618
CountyConfirmedDeaths
Mobile2191115
Jefferson1780102
Montgomery163238
Tuscaloosa73814
Marshall6879
Franklin5457
Lee54033
Shelby50319
Tallapoosa42364
Butler40217
Chambers35325
Walker3442
Elmore3398
Madison3274
Baldwin2839
Dallas2603
Morgan2511
Etowah24811
DeKalb2433
Lowndes23812
Coffee2291
Sumter2206
Autauga2164
Houston2094
Bullock2034
Pike1980
Colbert1782
Russell1670
Marengo1636
Lauderdale1612
Hale1598
Calhoun1543
Choctaw1518
Barbour1501
Wilcox1447
Clarke1422
Cullman1260
Randolph1257
Marion12111
St. Clair1181
Pickens1114
Dale1100
Talladega1093
Chilton1001
Limestone940
Greene944
Winston880
Covington771
Jackson772
Crenshaw763
Macon754
Henry742
Bibb721
Washington686
Blount611
Escambia573
Lawrence480
Geneva400
Conecuh391
Coosa381
Monroe372
Perry370
Cherokee373
Clay272
Lamar230
Fayette150
Cleburne141
Unassigned00

Tennessee Coronavirus Cases

Confirmed Cases: 22566

Reported Deaths: 364
CountyConfirmedDeaths
Davidson504062
Shelby4943111
Trousdale13924
Rutherford119623
Sumner88145
Hamilton79415
Bledsoe6071
Williamson55210
Putnam4795
Robertson4653
Tipton4423
Out of TN4184
Lake4140
Wilson4078
Knox3755
Bedford2834
Montgomery2693
Rhea2100
Hardeman1960
Madison1752
Loudon1430
McMinn14114
Macon1363
Cheatham1230
Bradley1221
Fayette1152
Cumberland1121
Dickson1090
Unassigned920
Blount913
Maury890
Sevier812
Washington750
Coffee730
Wayne640
Gibson631
Monroe622
Sullivan602
Hickman580
Lauderdale561
Franklin531
Greene502
Dyer500
Marion401
Anderson401
DeKalb370
Hamblen362
Smith341
White330
Hawkins332
Lawrence310
Grundy311
Haywood312
Marshall311
Obion301
Henry300
Jefferson280
Carroll271
Overton260
Meigs260
Weakley260
Lincoln250
Warren230
Cannon210
Perry210
Cocke200
Carter191
Campbell181
Morgan170
Jackson170
Crockett162
Roane160
Polk160
Johnson160
Henderson150
Hardin152
Sequatchie150
Humphreys131
Fentress120
McNairy120
Chester120
Giles120
Scott120
Stewart110
Claiborne90
Houston80
Grainger80
Clay70
Benton71
Decatur50
Unicoi40
Union40
Van Buren40
Lewis30
Pickett30
Moore30
Hancock10

 

 

Community Events