US Fed Freezes Benchmark Interest Rate..."Inflation Remains High"

[Anchor]

The U.S. Federal Reserve kept its benchmark interest rate unchanged overnight. Fed Chair Kevin Warsh noted that inflation remains at a high level, and expectations are growing that rates could be raised again in December.

Today's (October 29) first report comes from correspondent Kim Hyunwoo in New York.

[Reporter]

As widely expected, the U.S. Federal Reserve decided to maintain its benchmark interest rate at the current level between 3.75% and 4%.

This follows a pause after the Fed raised the benchmark rate by 0.25 percentage points last month for the first time in three years.

The Fed stated that while the inflation rate remains high, it will determine its policy direction after gathering more information.

With oil prices surging in the wake of the Middle East conflict, the inflation rate significantly exceeds the Fed's target of 2%.

[Kevin Warsh / Federal Reserve Chair: The inflation rate has exceeded the target for nearly six years, and it is our responsibility to bring inflation under control.]

Chair Warsh emphasized that next week's midterm elections did not influence the outcome of this meeting, and he also signaled a change by announcing that the frequency of rate-setting meetings will be reduced starting next year.

As the rate freeze was largely anticipated, major New York stock indices finished the session slightly higher without significant volatility.

[Eric Lynch / Senior Executive at Suncoast Equity Management: With the midterm elections just around the corner, I think Fed officials probably wanted to avoid having an impact on the election.]

At this rate-setting meeting, two out of the twelve participating members cast dissenting votes against the rate freeze, arguing for a 0.25 percentage point hike.

Given that the Fed hinted at the possibility of an additional hike within the year when it raised rates last month, some in the market project that rates will be raised again in December, when the final meeting of the year is held.

(Video 촬영: Lee Hee-hoon, Video Editing: Cho Mu-hwan)
(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.