The US Federal Reserve is set to hold interest rates steady at a 22-year high but keep the possibility of additional monetary tightening on the table in case its fight against inflation stalls.
The meeting will be the second in a row at which the Federal Open Market Committee opts not to increase interest rates, as officials seek more clarity on whether they have restrained economic activity sufficiently to bring inflation under control. After 11 increases since March 2022, the federal funds rate currently stands between 5.25-5.5 per cent.
The decision, to be announced at 2pm Eastern Time, comes at a delicate moment for global financial markets and the US economy, as war in the Middle East, warnings of renewed oil price volatility and a recent bond market sell-off complicate the outlook.