The U.S. Federal Reserve left its benchmark lending rate unchanged Wednesday, in an anticipated pause expected to give policymakers more time to assess the effect of earlier rate hikes aimed at cooling inflation.
After the two-day rate-setting Federal Open Market Committee (FOMC), the central bank announced the decision to hold the rate steady between 5.25 percent and 5.50 percent. It raised the rate by a quarter percentage point to the current level in July.
Wednesday's decision marks the second pause in the rate-hiking campaign that the Fed started in March last year in the hopes of bringing inflation down to its 2 percent target.
The Fed cited two goals of achieving maximum employment and inflation at the 2 percent rate over the longer run as the reason for its decision.
"Recent indicators suggest that economic activity has been expanding at a solid pace. Job gains have slowed in recent months but remain strong, and the unemployment rate has remained low," the Fed said in a press release, pointing to the overall economic conditions.
"The U.S. banking system is sound and resilient. Tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation," it added.
However, the central bank signaled that a fresh rate increase could come down the road should there be impediments to its goals.
"The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals," the Fed said.
The latest rate decision left the gap between the key rates of South Korea and the United States at up to 2.0 percentage points.
Source: Yonhap News Agency