The U.S. Federal Reserve held its key interest rate unchanged at 5.25% at its Open Market Committee meeting today, but left the door open for possible future increases.
Stocks moved lower on the news, as concern that the Fed may continue raising rates in the future seemed to trump the non-action this time around. The Dow was down 24 points, and the Nasdaq was off 7 points in late afternoon trading, reversing moderate gains earlier in the day.
In its accompanying statement, the central bank said that while inflation readings have been elevated in recent months, pressures "seem likely to moderate over time, reflecting contained inflation expectations and the cumulative effects of monetary policy actions and other factors restraining aggregate demand."
But while acknowledging continued risks of higher core inflation, which excludes volatile food and energy costs, the Fed repeated the mantra from its June meeting, asserting that "any additional firming that may be needed to address these risks will depend on the evolution of the outlook for both inflation and economic growth."
Article in detail from Forbes.com
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