The US Federal Reserve left its key lending rate unchanged again on July 31 and said it had made “some further progress” in its inflation fight.
Policymakers voted unanimously to maintain the US central bank’s benchmark interest rate between 5.25 per cent and 5.50 per cent, the Fed announced in a statement following two days of deliberations.
After a small uptick in inflation earlier this year, recent data suggests that the Fed’s mission of bringing inflation back down to its long-term target of 2 per cent is now firmly back on track.
Its favoured measure of inflation eased to an annual rate of 2.5 per cent in June, while economic growth has remained resilient, and the labour market has come into better balance.
“In recent months, there has been some further progress toward the committee’s 2 per cent inflation objective,” the Fed said.
This marks a slight change in tone from its decision in June, when it noted only that “modest further progress” had been made.
“The Committee judges that the risks to achieving its employment and inflation goals continue to move into better balance,” the Fed said, adding that it was “attentive to the risks to both sides of its dual mandate.”
Fed chairman Jerome Powell will address reporters later on July 31, and analysts expect him to hint at the possibility of an interest rate cut at the next Fed meeting in September.
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