The Federal Reserve keeps interest rates unchanged despite high inflation

BarcelonaThe Federal Reserve (the Fed, the central bank of the United States) has decided to keep interest rates unchanged, despite the rising cost of living in recent months, according to a statement released by the organization this Wednesday. The meeting of the Federal Open Market Committee (FOMC, the internal body that makes monetary policy decisions) held between Tuesday and Wednesday was the first chaired by Kevin Warsh.

Thus, the price of money in the US will remain in the range between 3.5% and 3.75%. The Fed's decision to keep rates stable comes in a context of high inflation in the US. Recently, the price growth of goods and services consumed by American families reached 4.2% annually, a rate more than double the 2% targeted by the central bank itself.

The price increases in recent months are mainly due to the rising cost of energy, particularly natural gas and oil, as a result of the war in Iran initiated by the US and Israel. The rise in energy prices has been noticeable in gasoline, which has become drastically more expensive in recent months, a fact that has a much greater impact on the pockets of Americans than Europeans, due to the greater dependence on cars among workers in the United States.

Similarly, the price of freight transport has also risen as a consequence of this increase in fuel costs, which ends up pushing up a large part of the products in the shopping basket.

At 8:30 PM (Catalan time), Kevin Warsh will appear for the first time in a press conference as Fed chairman to explain the decision made by the committee. The economist, who replaces Jerome Powell at the head of the monetary institution, is considered a man ideologically close to the US President, Donald Trump, who since his return to the White House had harshly attacked Powell to force him to cut interest rates.