U.S. Feds leaves interest rates unchanged pending ‘further economic improvement’

The U.S. Federal Reserve decided on Thursday to maintain its benchmark federal funds rate in the zero to 0.25 percent range. The rate has been unchanged since December 2008 but there had been increasing speculation in recent weeks on whether the economic recovery has been strong enough to withstand a light tap on the brakes.

"To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that the current 0 to 1/4 percent target range for the federal funds rate remains appropriate," the Federal Open Market Committee said in a press statement.

The statement added: "In determining how long to maintain this target range, the Committee will assess progress - both realized and expected - toward its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments."

The statement continued: "The Committee anticipates that it will be appropriate to raise the target range for the federal funds rate when it has seen some further improvement in the labor market and is reasonably confident that inflation will move back to its 2 percent objective over the medium term."

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