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Fed holds US interest rates for fifth straight meeting

The decision keeps the policy rate in a 3.5% to 3.75% range while inflation remains above the Fed's 2% target and Middle East conflict risks swirl around oil prices.

Reported · Written up by our desk · Central Banks

The Federal Reserve held US interest rates for the fifth straight time, keeping the policy rate between 3.5% and 3.75%, a move that had been broadly expected, BBC Business reported. The Fed has kept rates at that level since December.

Higher rates make borrowing more expensive for loans, mortgages, and credit cards, though they can also boost returns on savings, according to the outlet. Policymakers said the economy is expanding at a solid pace even as uncertainty persists.

BBC Business said inflation in the year to June was 3.5%, but prices are still rising faster than the Fed's 2% goal. The Fed also pointed to energy price increases contributing to elevated inflation.

The Fed voted 9-3 to keep rates on hold, with three policymakers preferring a small hike amid speculation that renewed US-Iran-related tensions could push up global oil and food prices. The report noted Brent crude rose by more than 6% to above $89 a barrel on Wednesday, underscoring the oil-linked inflation risk.

Latest closeWTI crude $81.23 ▼1.7%|Brent $85.92 ▼2.8%

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