Federal Reserve holds firm on bank rate as hopes of a September cut rise

Committee remains data-driven

The US Federal Reserve has voted to stick with its current federal funds rate of 5.25%-5.5%, but implied there could be appetite later in the year for a snip.

Despite its stance that "recent indicators suggest that economic activity has continued to expand at a solid pace", the committee said on Wednesday (31 July) that "the committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%".  This move comes just a few weeks after data released by the Bureau of Labor Statistics revealed that the annual rate of US inflation had fallen to 3% in June, surpassing many economists' expectations by 0.1%.  Last week, though, core PCE inflation returned a...