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Following the March meeting of the Federal Open Market Committee (FOMC), the United States Federal Reserve (Fed) unanimously left the federal funding rate unchanged in the range of 0-0.25 percent, in line with The expectations.
The Fed also kept the interest on excess reserves at 0.10 percent.
In the statement, which also noted that the bank will continue to buy assets, at least $ 80 billion per month for treasuries and at least $ 40 billion per month for purchases of mortgage-backed securities, until “progress is made. significant “in the maximum targets for employment and price stability.
In the statement, it was indicated that the Committee would be willing to adjust its monetary policy stance appropriately if risks arise that may hinder the achievement of its goals.
In the statement made by the Fed after the two-day meeting of the Federal Open Market Committee (FOMC), it was reiterated that the bank’s determination to use all its tools to support the US economy in this challenging period, and that price stability targets will be lowered. be supported with maximum employment.
In the statement, it was noted that although the sectors most affected by the epidemic continued to weaken after the slowdown in the recovery, economic activity and employment indicators have shown an increase in the recent period.
2 percent inflation below Overall financial conditions were stated to remain favorable.
The statement noted that the course of the economy will continue to depend significantly on the course of the virus, including the progress of vaccines, and that the public health crisis continues to put pressure on economic activity, employment and inflation, and poses significant risks to the economic outlook.
The statement said that the purchase of assets helps the market operation to be regular and the financial conditions conducive, thus supporting the flow of credit to households and companies.
The statement reiterated that the Committee will continue to monitor the effects of incoming economic data on the outlook while assessing the supportive stance of monetary policy.
The statement stated that the monthly asset purchase program of at least 120 billion dollars will continue and it was emphasized that financial conditions continue to support the economy in general.
The Fed, which also announced its estimates for the economy, increased its growth and inflation forecasts, but did not change its estimates of the interest rate.
According to estimates by the Fed, the average expectation of the financing rate was 0.1 percent for the years 2021, 2022, and 2023, and the expectation of the average long-term interest rate was 2.5 percent. .
The growth forecast for the US economy for this year has been increased from 4.2 percent to 6.5 percent. The forecast for growth of the country’s economy for 2022 was increased from 3.2 percent to 3.3 percent, while the forecast for 2023 was lowered from 2.4 percent to 2.2 percent.
The long-term growth expectation for the US economy was 1.8 percent.
The inflation forecast for this year has also been raised from 1.8 percent to 2.4 percent. Inflation forecasts increased from 1.9% to 2% by 2022 and from 2% to 2.1% by 2023.
In the statement, which also includes estimates of the unemployment rate, the unemployment rate in the country, which was forecast at 5 percent this year, was estimated to be 4.5 percent.
Estimates of the unemployment rate in the country fell from 4.2 percent to 3.9 percent by 2022 and from 3.7 percent to 3.5 percent by 2023.
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