Fed’s Inflation Rate Kept Unchanged Near Target

Interest rates were kept steady by the Federal Reserve and confidently saying that recent inflation rise is still on track in rate hike this June and still close to the U.S. central bank target.

The rate-setting committee understated the recent slowdown of the economy including job growth as moderate and job gains on average that had been strong in past few months.

The increase of Fed’s inflation is a good thing after a sharp price gain of two percent goal despite the good recovery of the economy from the recession on 2007 to 2009. The target is close to the two-percent target of the committee, which is presumed to be achieved in the medium term.

Fed decided to maintain the target overnight lending rate within the target range of 1.50 and 1.75 percent in accord. Investors anticipate another increase for this week’s meeting.

In March, the Fed will raise their rates and presumes another two hikes this year. Although, some analysts said that three times is possible. Investors highly anticipated a rate hike in June 12-13 policy meeting.

The U.S. traders for short-term still believe future rates after the release of would be maintained for at least two more times this year. The U.S. stocks incurred losses prior to its decline. On the other hand, Treasury yields moved higher shortly as the dollar (.DXY) rose to its highs for the day against a basket of currencies.

Changes in the statement imbibe changes in the data especially on the inflation outlook, according to the chief economist at Amherst Pierpont Securities in Stamford, Connecticut, Stephen Stanley. “I think a June rate hike is a done deal unless something dramatically changes between now and June.”, he added.