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The US Federal Reserve stops raising interest rates

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The Federal Reserve (Fed), the central bank of the United States, decided on Wednesday to pause raising interest rates for the first time since March 2022, while keeping them in the range between 5% and 5.25%, the entity revealed.

This decision was known the day after data released by the US Department of Labor, which showed that inflation in the United States slowed significantly from 4.9% in April this year to 4% in May, the lowest level recorded since March 2021.

In the statement announcing today the decision, which was taken unanimously by the Monetary Policy Committee, the Fed indicated that it remains very attentive to “inflation risks”, considering it still “high” and reinforcing the target of reaching the 2% target in this indicator.

According to the Fed, maintaining this range will allow the committee to “evaluate additional information and its implications for monetary policy.” “The committee is firmly committed to returning inflation to its 2% target,” he explained.

However, the Fed warned that it will continue to monitor the implications of the information it receives for the country’s economic outlook. The committee will be ready to amend its guidance on monetary policy, as appropriate, in the event that risks arise that may prevent the achievement of the targets it has proposed.

According to the same note, the committee’s assessments will take into account “a broad range of information,” including labor market conditions, inflation pressures and expectations, and financial and international developments.

In monthly terms, the U.S. Consumer Price Index (CPI) grew by 0.1% in May, compared to the 0.4% recorded in April, the U.S. Labor Department said in a statement released on Tuesday.

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Annual inflation was in line with analysts’ expectations, but eased more than expected on a monthly basis, as the market was pointing to a 0.4% rise in prices in May.

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