US Fed holds interest rates, tightens monetary policy stance

The US Federal Reserve has held interest rates, however its has tightened a monetary policy stance that its officials believe can lower inflation, without wrecking the economy or leading to large job losses.

 

US Fed Chair Jerome Powell says policy decisions will remain tight until the reserve is comfortable with inflation movements. 

 

"We decided to leave our policy interest rate unchanged and to continue to reduce our securities holdings. Given how far we have come, we are in a position to proceed carefully as we assess the incoming data and the evolving outlook and risks," he said. 

 

"Real interest rates now are well above mainstream estimates of the neutral policy rate, but we are mindful of the inherent uncertainties in precisely gauging the stance of policy. We're prepared to raise rates further, if appropriate, and we intend to hold policy at a restrictive level until we're confident that inflation is moving down sustainably toward our objective."