The Fed Maintains Interest Rates Near Zero as U.S. Economy Begins to Pick Up

The Federal Reserve (Fed) held interest rates at 0-0.25% as the U.S. economy started to pick up in recent months from its shaky shape, plunged by the coronavirus outbreak.

 

At the meeting on July 29, 2020, the U.S. Monetary Policy maintained its interest rates near zero since the last cut on March 2020, when the coronavirus outbreak started to overwhelm the country.

“Following sharp declines, economic activity and employment have picked up somewhat in recent months but remain well below their levels at the beginning of the year,” stated the Fed in a post-meeting statement. “Weaker demand and significantly lower oil prices are holding down consumer price inflation. Overall financial conditions have improved in recent months, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses.”

 

In addition, the Fed also affirmed its commitment to maintain its bond purchases and the array of lending and liquidity programs also associated with the virus response.