Federal Reserve Holds Interest Rates Near Zero, Bond Purchases at $120B… Again

Alas, another FOMC meeting has come and gone, and interest rates are still at near-zero, and monthly bond purchases are still sky-high at $120 billion… yet again. But according to Fed Chair Jerome Powell, there is no need to worry, because the economy continues to “strengthen,” but still faces “substantial further progress” on inflation and employment. Ah, yes, finally some oxymoron clarity.

As was largely expected, the conclusion of the two-day FOMC meeting heeded no new results, but much of the same, mundane, remarks in terms of employment, inflation, and talks of tapering. Although the committee did concede that the US economy is strengthening, Powell was quick to interject the optimism, saying that the central bank is not even near the realm of a rate hike consideration. “Our approach here has been to be as transparent as we can. We have not reached substantial further progress yet,” he explained. “We see ourselves having some ground to cover to get there.”

During the subsequent press conference, CNBC reporters pressed the Chairman on what exactly, the phrase “substantial” means, to which Powell said refers to robust job numbers and a breakthrough towards maximum employment. Then, in an ensuing question, Powell brushed off the Fed’s apparent lack of concern regarding surging inflation, and once again reiterated that any price pressures are — yes, you guessed it— transitory.

So, in other words, the Fed’s only objective is employment; inflation has not even made it on the radar yet, despite Americans paying higher prices for housing, food, vehicles, and nearly everything else in between. Rather, prices will likely have to get significantly higher before the Fed even begins “talking about talking about” tapering.

In a separate motion, the Fed also revealed plans to create two standing repo facilities, one for foreign authorities and a second for domestic markets. The new facilities will allow transactions of Treasurys and reserves among financial institutions.

Following the meeting, the US dollar was sent plummeting to the lowest in two weeks.


Information for this briefing was found via the Federal Reserve and CNBC. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Fortune Bay: The Potential Billion Dollar Project

Japan Gold Enters New Chapter as Barrick Alliance Concludes – John Proust

Barrick Mining’s “Company Defining [Gold] Discovery”

Recommended

ESGold Secures $9 Million In Non-Dilutive Funding From Ocean Partners

Altamira Gold Encounters Porphyritic Intrusive Rocks In Initial Scout Drilling At Regional Targets

Related News

Gold Continues Descent Following Powell’s Hawkish Stance

Gold prices continued their downward slide on Thursday, after plummeting by the most in over...

Friday, January 28, 2022, 03:40:00 PM

Canadian Inflation Picks Up 3.1% In June

Consumer prices across Canada decelerated slightly in June, but price pressures still remained elevated at...

Thursday, July 29, 2021, 02:28:00 PM

Federal Reserve Hikes Rates 25 Basis Points, Hints At More Future Increases

As widely expected, the Federal Reserve hiked borrowing costs another 25 basis points, wrapping up...

Wednesday, February 1, 2023, 02:12:41 PM

Cathie Wood Criticizes Financial Markets for Focusing on Inflation

Wall Street darling Cathie Wood has once again gone rogue against the common consensus on...

Thursday, February 10, 2022, 03:05:00 PM

Fed’s Key Inflation Gauge Posts Sharpest Increase Since 1990s

Yet another inflation indicator is flashing bright red for the 8374394589th consecutive month in a...

Friday, November 26, 2021, 10:03:00 AM