Fed keeps interest rate steady

Washington: The Federal Reserve kept its key lending rate unchanged on Wednesday but said it will turn its sights to low inflation and developments in the world economy.

That was a signal that central bankers, who have repeatedly pledged to change course if needed, are monitoring the global slowdown and persistent absence of price pressures, which open the door to further rate moves.

At its final meeting of 2019, the Fed´s policy-setting Federal Open Market Committee left the benchmark interest rate in the target range of 1.5-1.75 percent, as expected, where it has been since the third rate cut of the year in October.

The vote this time was unanimous, following several meetings where one or more FOMC members dissented. The decision, though widely expected, is unlikely to please President Donald Trump who has repeatedly berated the Fed and called on its Chairman Jerome Powell to slash rates to zero to supercharge the US economy, which Trump says is at a disadvantage against foreign economies with lower rates. Powell will hold a press conference starting at 2:30 pm (1930 GMT) to explain the rationale behind the decision.

Prior to the meeting, Powell and other Fed officials clearly signaled they were likely to stand fast as they wait to see the effects of the stimulus provided this year.