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| ▲ This file photo, released by Reuters, shows U.S. Federal Reserve Chair Jerome Powell speaking during a press conference in Washington on Dec. 18, 2024. (Yonhap) |
(LEAD) FOMC-rate decision
(LEAD) U.S. Fed holds key lending rate steady
(ATTN: UPDATES with more info in paras 4-6)
By Song Sang-ho
WASHINGTON, Jan. 29 (Yonhap) -- The U.S. Federal Reserve kept its benchmark interest rate unchanged Wednesday, less than a week after President Donald Trump said he would demand rate reductions.
After the two-day Federal Open Market Committee (FOMC) meeting, the central bank announced the decision to hold the rate steady at the 4.25 to 4.50 percent range. It followed a quarter-percentage-point cut last month, another 25 basis-point cut in November and a 50-basis-point reduction in September.
Last month, FOMC members' new median economic projections showed that the federal funds rate would be cut to 3.9 percent at the end of this year, signaling the possibility of two rate reductions this year.
"Recent indicators suggest that economic activity has continued to expand at a solid pace," the Fed said in a press release. "The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid. Inflation remains somewhat elevated."
In a video call during the World Economic Forum in Switzerland last week, Trump said he will demand that interest rates drop "immediately," claiming that he knows rates better than the central bank.
This week's rate decision put the gap between the key rates of South Korea and the United States at up to 1.5 percentage points.
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