US Fed keeps interest rates unchanged

Washington/Mumbai, Sep 21 (IANS) As the global financial markets waited nervously, the US Federal Reserve kept its key interest rates unchanged — a move that should bring some cheer when Indian markets open on Thursday.

“The committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives,” said a statement by the Federal Open Market Committee after a much-watched, two-day meeting.

The committee said even though unemployment rate is little changed in recent months, the job gains have been solid, even as household spending has been growing strongly. But business investment has remained soft, while inflation has continued to run below the 2 per cent long-term target.

“Against this backdrop, the committee decided to maintain the target range for the federal funds rate at 0.25 per cent to 0.50 per cent.”

The meeting of the US central bank’s key committee came well past the closing bell at Indian bourses. But it had a major bearing on investors sentiments.

Amid heavy selling pressure, the 30-scrip sensitive index (Sensex) of the BSE closed with a loss of 15.78 points or 0.06 per cent on Wednesday, after some volatile trading. The index touched a high of 28,689.36 points and a low of 28,462.33 points intra-day.

–IANS

ap/rn

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