The U.S. Federal Reserve has held interest rates steady and signaled borrowing costs are likely to remain unchanged indefinitely due to persistent moderate economic growth and low unemployment.
The decision by the U.S. central bank left the benchmark overnight lending rate south of the border in its current target range between 1.50% and 1.75%. New economic projections showed that the Fed does not foresee any changes to interest rates until at least 2021.
"The Committee judges the current stance of monetary policy is appropriate to support sustained expansion of economic activity, strong labour market conditions, and inflation near the... symmetric 2 per cent objective," the Fed said in a policy statement issued Wednesday.
The Fed now feels that it has engineered a "soft landing" for the U.S. economy after a volatile year in which recession risks rose, the U.S. bond yield curve inverted, and trade policy disrupted markets.
Amid an ongoing U.S.-China trade war, Fed policymakers said they would continue monitoring "global developments" in deciding whether interest rates need to change. They also said they would keep an eye on "muted inflation pressures," a reflection of concern that the pace of price increases has failed to hit the central bank's target.
