US Federal Reserve Holds Interest Rates Steady - UK Rate Expected To Be Similar

1st February 2024

The Federal Reserve announced Wednesday it was keeping interest rates at their current levels amid improving consumer confidence and a declining inflation rate.

In the run-up to Wednesday's announcement, some Fed officials have been signaling that the current rate has been enough to knock inflation down toward the central bank's 2% target.

The federal funds target rate has remained at 5.25% to 5.5% since last summer, following 11 increases that began in March 2022. The rate sets a benchmark for other interest rates throughout the economy — everything from credit cards to mortgages, and business and car loans.

The European Central Bank kept its key rate unchanged at a record high 4% last Thursday but sounded confident that inflation was coming under control, fuelling already widespread bets in the market that policy easing could start in early spring.

The Bank of England will announce the interest rate for UK at Lunch time on Thursday 1 February 2024.