The U.S. Central Bank maintains the key interest rate stable at 4.25%-4.5% after five consecutive unchanged decisions.
This decision comes amid pressure from President Trump to cut interest rates, but economic instability from the import tariffs imposed by the U.S. government makes the Fed more cautious about further adjustments.
MAIN CONTENT
The Fed keeps the target interest rate at 4.25%-4.5% for the fifth consecutive time, in line with market predictions.
The President of the United States urges a cut in interest rates, but the Fed is cautious due to risks from import tariffs and inflation.
The financial market remains slightly stable, with Bitcoin prices around $118,000 not reacting strongly after the decision.
Why does the Fed keep the target interest rate unchanged?
The U.S. Central Bank decided not to lower interest rates again despite significant pressure from the government. Fed Chairman Jerome Powell stated that import tariffs create economic instability, causing the agency to be cautious in its next monetary policy decision.
Inflation increased slightly due to rising prices of consumer goods such as household appliances, furniture, and toys, but has not exceeded forecasts. Fed officials want to observe more real data before changing interest rates to ensure long-term economic stability.
This is the fifth consecutive time the interest rate has been kept unchanged since the last adjustment, demonstrating the Fed's steadfastness in the face of uncertain risk factors in the global market.
What is the impact of the interest rate decision on financial markets and cryptocurrencies?
Information about the Fed maintaining interest rates has created a slight reaction in traditional financial markets. The Dow Jones index rose by 0.06%, and the Nasdaq increased by 0.5% before the decision, while the yield on 10-year Treasury bonds rose to 4%, and the U.S. dollar strengthened with the Dollar Index reaching 99.4.
"We will cautiously monitor new data and consider risks to adjust the appropriate interest rate range in the coming time."
Jerome Powell, Fed Chairman, July 2024
Meanwhile, the cryptocurrency market has not shown any significant fluctuations after this decision. Bitcoin prices remain around $118,000, reflecting an accumulation state and waiting for new signals from monetary policy.
Maintaining stable interest rates may help sustain liquidity in the short term but also warns of challenges to economic growth due to geopolitical factors and tariffs.
How does the Fed plan to adjust policy in the future?
The Fed has affirmed it will carefully consider economic data and macroeconomic outlook before making any interest rate adjustments. This caution reflects the experience and expertise of policymakers in balancing growth and controlling inflation.
However, in light of pressure from the government and unexpected fluctuations in the global market, the possibility that the Fed will change interest rates if necessary to support the economy cannot be ruled out. Investors are advised to closely monitor economic reports and information from the Fed.
Frequently Asked Questions
How does the Fed's decision to keep interest rates unchanged affect borrowers?
Maintaining interest rates helps keep borrowing costs stable, reducing pressure on individuals and businesses from rising borrowing costs, but it may also limit short-term economic stimulus measures.
How does the Fed's decision affect Bitcoin prices?
Bitcoin prices are often influenced by interest rate policies because low interest rates encourage investment in risky assets like cryptocurrencies. Currently, Bitcoin prices are stable following the decision to maintain interest rates.
What factors does the Fed consider before changing interest rates?
The Fed focuses on analyzing inflation data, economic growth, geopolitical risks, and trade policies, particularly the impact of current import tariffs.
Will the Fed be influenced by political pressure in deciding interest rates?
The Fed operates independently based on expertise and data, however, political pressure from the government can still indirectly influence the decision-making process.
How does keeping current interest rates affect the stock markets?
Stable interest rates help the stock market maintain an accumulation state, limiting sharp fluctuations, allowing investors to better assess the fundamentals.
Source: https://tintucbitcoin.com/fed-giu-lai-suat-on-dinh-du-ap-luc/
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