The US Federal Reserve does not consider key interest rates as expected

The US Federal Reserve has already raised its rates three times this year, the last time at the September monetary policy meeting. At that time, the key interest rate was raised to the current range of 2.00 to 2.25%. In the run-up to today's meeting, economists were expecting the Fed not to touch interest rates in November and then rise again in December.

On average, key members of the central bank recently released four rate hikes and three new measures next year. Recently, however, volatility in the financial markets has increased, partly because of speculation that the Fed could increase interest rates even more quickly.

The reasons for this speculation are the strong economic growth in the United States and the decline in unemployment. In the third quarter, the US economy grew by 3.5%. It was slightly less than the second quarter, where the value was even 4.2%, but still very robust.

In addition, the unemployment rate in October was 3.7%, its lowest level since December 1969. For future monetary policy to continue, it is essential that growth and the low unemployment rate have been achieved. an impact on wages and inflation.

Until now, wages have increased only moderately. Recently, however, there were signs of a stronger momentum. For example, wage growth reached 3.1% in October for the first time. This also increases the risks of inflation. The US Federal Reserve aims for an inflation rate of about 2%. In September, it was 2.3%.

The Fed has also been politically under pressure in recent weeks. US President Donald Trump strongly criticized him for raising his interest rates. "I think the Fed has gone crazy," Trump said in mid-October, as stock prices in the US were also down, fearing a further rate hike. The central bank "makes a mistake".

More information on the debate at Bank's meeting today can be provided in the minutes of the meeting. The Fed will release this on November 29th.

With agency equipment.