The Federal Reserve on Wednesday voted against raising interest rates in the wake of a dismal jobs report and concerns about the global economy.
It seemed at one point the Fed would hike interest rates in June, but May’s jobs bombshell, low inflation and geopolitical headwinds were too much for the Fed to ignore.
While economic growth “appears to have picked up,” jobs gains had “diminished” and “business fixed investment has been soft.” The U.S. generated only 38,000 jobs in May.
Looking at projections offered by the Fed this afternoon, six officials predict single rate hike this year, up from one at the previous meeting.
Their so-called ‘Dot plot’ still signals two rate increases this year, even though the Fed reduced their 2016 GDP forecast to 2% from 2.2%.
There was little indication of when exactly the next rate hike will come, although most analysts say a move in July is highly unlikely.
Fed Chair Janet Yellen meets the press at 2:30 pm ET to discuss the decision and expound on the central bank’s assessment of the U.S. economy.
The material has been provided by InstaForex Company – www.instaforex.com