Federal Reserve upbeat on US economy but holds rates
The US central bank dismisses weaker first quarter economic growth to remain bullish on the prospect of further rate hikes.
The US Federal Reserve kept interest rates on hold at its latest policy meeting, remaining upbeat on economic prospects despite weak first quarter growth.
While the US central bank's decision to maintain its benchmark rate at a target range of 0.75%-1% was largely expected, the statement accompanying the decision was being closely-watched for hints on its next move.
It pointed to a resilient jobs market and strong consumer spending – coupled with inflation "running close" to its 2% target – as evidence the economy remained strong despite weaker-than-expected first quarter growth.
Data released last Friday showed the slowest pace of expansion in US gross domestic product (GDP) for three years.