WASHINGTON-The US Federal Reserve is widely expected to hold interest rates steady on Wednesday after a summer of mixed economic data while leaving the door open to another hike if needed. The Fed has raised interest rates 11 times over the last 18 months, lifting its key lending rate to a level not seen for 22 years as it tackles inflation still stubbornly above its long-term target of two percent.
After falling sharply over the last year, inflation has ticked up again in recent months due to a spike in energy costs, keeping up the pressure on the Fed. But analysts and traders still broadly expect the US central bank to hold rates steady on September 19-20 in order to give policymakers more time to assess the health of the world’s largest economy.
“We think the Fed is done with its tightening cycle,” EY Chief Economist Gregory Daco told media. “That view has not changed over the past couple of months.” “After raising rates in July, we expect the Fed to follow through on strong pre-meeting signals and hold rates steady,” Deutsche Bank economists wrote in a note to clients on Friday.