The Federal Reserve has kept the interest rates stable, but has indicated its view of inflation and revised its growth reasons, stating Trump's economic policy.
The decision of the central banks keeps the benchmark percentage between 4.25 percent and 4.5 percent like the expected analysts.
Powell indicated that, despite the fears for inflation caused by rates, the FED would adhere to his plan this year to lower the rates twice.
That satisfied investors and sent us stock indexes during the afternoon trade, with the S&P 500 rising by more than one percent.
Lower rates make it cheaper for companies to borrow money, but crucial also makes the loan costs for ordinary Americans, which then have more to spend on goods and services.
“We don't have to be in a hurry to adjust our policy position,” said Powell in comments made after the rate announcement.
FED officials have considered their prospects for inflation this year, with their preferred measure for price increases that are expected to end the year at 2.7 percent versus the 2.5 percent expected in December.
The purpose of the FBI is to get inflation to 2 percent.
Jerome Powell has a press conference after the last interest rate decision of the FED
Powell said that the rising inflation expectations in 'good part' are due to rates as a 'driving factor'.
President Trump's tariff heads sent the S&P 500 to correction last week.
The explanation of the 'wait -and -see' decision of the FED said Powell that the policy changes of the new administration in trade, immigration, tax policy and regulations will have a combined impact on the economy.
“It is the net effect of these policy changes that are important for the economy and for the path of monetary policy,” said Powell.
In addition to increasing inflation, the central bank now predicts economic growth more than expected.
The combination of higher inflation and delaying growth can lead to a dreaded period of stagflation.
Economists have increased warnings. A recession can loom when Americans fall behind for car loans and consumers long -term expectations for inflation that has risen to the highest level since the 1990s.
