Fed Holds Interest Rates, Foreseeing Favorable Economic Outlook in 2020

The Federal Reserve (Fed) on Wednesday, 11 December 2019 held the last policy meeting of the year and made an announcement to keep the policy rate unchange at 1.50-1.75%.

Fed Chair Jerome Powell signaled that the borrowing cost would not change anytime soon amid the moderate economic growth and low unemploymemt rate which expected to persist through the presidential election in 2020.

“Our economic outlook remains a flavorable one, despite global developments and ongoing risks,” said Powell.

Fed had made three cuts in 2019 to keep the economy running after being harassed by the trade war between the U.S. and China.

Although Fed policymakers had some disagreement on the vote and projections on the previous policy meeting, the statement on the last meeting appeared to have an unanimous vote. Moreover, 13 of 17 policymakers foresaw an unchange of interest rate until 2021 while other four expected only one hike next year.