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The Federal Reserve Announced To Maintain The Benchmark Federal Funds Rate Unchanged And Began To Reduce The Scale Of Bond Purchases

The Federal Reserve Announced To Maintain The Benchmark Federal Funds Rate Unchanged And Began To Reduce The Scale Of Bond Purchases

Gold and silver suffered a heavy setback in overnight trading, but are now gradually recovering from the heavy hit. The price of gold rose to US$1,776.88, while the price of silver rose to US$23.66. The US ADP employment report data made good, strongly exerting pressure on the precious metals trend. The Fed’s announcement of a reduction in bond purchases provided slight support, but analysts generally believed that the signal provided by the Fed’s FOMC meeting was not surprising. The Fed announced as scheduled to maintain the federal funds benchmark interest rate unchanged at 0%-0.25%. The Fed also announced that it will soon start to slow down the pace of bond purchases. This is the first step taken by the Fed to stop providing substantial assistance to the market and the economy. The Fed announced as scheduled that the US Federal Open Market Committee (FOMC) stated in a post-meeting statement that it will begin to reduce the scale of bond purchases later this month. In the process, the Federal Reserve will cut 15 billion US dollars from the 120 billion US dollars currently purchased every month, of which 10 billion US dollars are national debt and 5 billion US dollars are mortgage-backed securities. The committee stated that the move was “in view of the fact that the economy has made substantial further progress towards the committee’s goals since December last year”.
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