September 22 (WNN) — The Federal Reserve held its benchmark lending rate steady on Wednesday, leaving it near zero and warned that growth could swell as the economy rebounds from the COVID-19 pandemic.
The Federal Open Market Committee concluded its two-day meeting with a statement that said interest rates would remain at 0% to 0.25%, the same level since March 2020, the start of the economic slowdown.
The state of the US economy depends on the course of COVID-19, the statement said.
“With progress on vaccination and strong policy support, indicators of economic activity and employment continue to strengthen,” it read. “The areas most affected by the pandemic have improved in recent months, but the increase in COVID-19 cases has slowed their recovery.
“Inflation has risen, largely reflecting temporary factors. Overall financial conditions remain moderate, partly reflecting policy measures to support the economy and credit flow to American households and businesses.”
Fed Chairman Jerome Powell said the FOMC plans to pull back on some stimulus measures while the economy recovers. It is likely that interest rates could see their first hike in 2022 since the start of the pandemic.
“While no decision was made, participants generally observed that as long as recovery remains on track, a gradual tapering process that ends in the middle of the next year is likely to be appropriate,” he said.