The Fed leaves the US key interest rate unchanged – after a historically long rate hike cycle, reports Bloomberg.
At the same time, there are signs that two more interest rate increases may come later.
– A major risk for the American central bank is that this becomes some type of monetary policy hangover, says Robert Bergqvist, senior economist at SEB.
The US central bank, the Federal Reserve, Fed, has raised interest rates at the last ten meetings. In May, it was raised by 0.25 percentage points to the range of 5.00–5.25, figures which thus stand during June.
The announcement was expected, by many experts.
– What surprised me was that they are now signaling that they may have to raise the interest rate twice more, says Robert Bergqvist, senior economist at SEB.
– You want to evaluate and look for these very aggressive interest rate increases that we have seen in the last 15 months, but you obviously think that the inflation risks are significant in the US economy, so you want to flag that you may not be finished with your interest rate increases, continues the expert.
This is how Sweden is affected
The Fed is the world’s largest and most important central bank – and the bank’s decisions affect Sweden to the greatest extent.
– With the Fed now apparently adding two interest rate increases, the risks increase that the Riksbank will not be finished with its interest rate increases either. Unfortunately, we also received an inflation figure today that is a bit disturbingly high, which suggests that the Riksbank may have to go further with its interest rate increases.
The interest rate announcement comes after the latest US inflation figures were presented on Tuesday. In May, the inflation rate was 4.0 percent – the lowest figure since March 2021.
The corn figure can be compared with 4.9 percent the previous month and 4.1 percent, which was the average expectation of market analysts.