New Delhi [India], February 20 (ANI): The Federal Open Market Committee (FOMC) remains focused on its dual mandate of maximum employment and stable inflation at 2 per cent, according to the minutes of the latest meeting.

The Federal Open Market Committee (FOMC) has decided to keep interest rates unchanged, signalling that a rate cut is not imminent.

The Fed maintained the target range for the federal funds rate at 4.25 per cent to 4.50 per cent. Additionally, the Board of Governors voted unanimously to keep the interest rate on reserve balances at 4.4 per cent and the primary credit rate at 4.5 per cent, effective January 30, 2025.

Fed officials however acknowledged that economic activity continues to grow at a solid pace. Consumer spending remains strong, supported by real wage growth, a robust labour market, and stable household balance sheets.

The unemployment rate has remained low, reinforcing confidence in labour market conditions. However, inflation is still somewhat elevated, leading policymakers to take a cautious stance on monetary easing.

Dallas Fed President Lorie Logan cautioned that lower inflation alone does not necessarily justify further rate cuts. She emphasized that policymakers need to assess broader economic conditions before making any changes to the monetary policy stance.

The Committee noted that the risks to its employment and inflation goals are roughly balanced but acknowledged the economic outlook remains uncertain.

It pledged to monitor economic data closely and adjust policies if risks emerge that could hinder progress toward its objectives.

Following a cumulative 100 basis points (bps) rate cut in 2024 to boost economic activity, the Federal Reserve is expected to begin 2025 without further adjustments. The Federal Open Market Committee (FOMC) convened on January 28 and will conclude discussions on January 29.

According to the report, the labour market has shown improvement, with consistent hiring and a stable unemployment rate in the last quarter of 2024. Previous concerns about a slowdown in job growth earlier in 2024 have diminished. The FOMC may highlight these positive trends in its policy statement.

While inflation has been declining, the process remains gradual. Core inflation remains around 3 per cent, still above the Fed's 2 per cent target. With the US economy maintaining a steady growth rate of approximately 2.5 per cent, the decision to keep interest rates unchanged appears justified for now.

The next FOMC meeting is scheduled for March 18-19, 2025, where officials will reassess economic conditions and determine the future course of monetary policy. (ANI)