AA / Istanbul
The U.S. Federal Reserve (Central Bank) is poised to step up the pace of interest rate hikes to rein in inflation, according to minutes from the Fed’s latest meeting earlier this week. month of May, and which was published this Wednesday.
The minutes said the 10-member Fed Monetary Policy Committee was “strongly committed to controlling inflation.”
At a meeting that took place on May 3-4, the Fed raised interest rates by half a percentage point, bringing the rate to 0.75%.
Also according to this same minutes of the meeting, the committee members felt that “it may be appropriate to increase the federal funds (interest) rates by a similar rate during the next two meetings”.
Although the committee stressed in the minutes that the US economy is “in a strong position”, it still urged that the Federal Reserve act “swiftly” to raise interest rates and cut its bond holdings.
Another point raised by the minutes, the monetary policy committee had already decided to start reducing the Fed’s holdings of these bonds, from the beginning of next June.
Although the US inflation rate slowed last April to 8.3%, on an annual basis, from 8.5% last March, it still remains at its highest level in 40 years.
Members of the Fed’s Monetary Policy Committee unanimously agreed, according to the minutes, that “price pressures are still elevated, and it is too early to say that inflation has peaked.” .
The US Federal Reserve is targeting an inflation rate of 2% over the medium term.
In March 2020, the Fed cut threshold interest rates from nearly 0% at the start of the coronavirus pandemic, in an effort to reduce the impact of the health situation on the world’s largest economy.
* Translated from Arabic by Mounir Bennour.
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