Washington: The U.S. Federal Reserve left its benchmark interest rate unchanged for the second consecutive time on Wednesday, amid rising concerns over the impact of the ongoing U.S.-Israeli war against Iran on oil prices and inflation.
According to Yonhap News Agency, during the two-day Federal Open Market Committee (FOMC) meeting, the central bank decided to leave the rate unchanged at the 3.5-3.75 percent range. The pause put the gap between the key rates of South Korea and the United States at up to 1.25 percentage points.
FOMC members' new median economic projection indicates that the federal funds rate is expected to be cut to 3.4 percent at the end of this year, which aligns with the December forecast. This signals the possibility of a quarter percentage point cut this year.
The Fed's decision to stand pat came as the central bank faced a tough rate-setting decision due to rising oil prices and its potential impact on inflation, and a weak U.S. employment report, which showed a loss of 92,000 jobs last month.