Fed announces rate decision

In the statement made by the Fed, it was noted that economic activity and employment indicators continued to strengthen.

In the statement, it was noted that the sectors negatively affected by the new type of coronavirus (Kovid-19) epidemic have improved in recent months, and it has been stated that they have been affected by the sharp increase in Kovid-19 cases recently.

In the statement, it was reported that supply and demand imbalances related to the epidemic and the normalization of the economy continue to contribute to high inflation.

Pointing out that general financial conditions continue to be supportive, it was stated that the course of the economy continues to depend on the course of the virus.

In the statement, it was stated that the progress in vaccination against Kovid-19 and the easing of supply constraints are expected to support the decrease in inflation as well as continued gains in economic activity and employment.

Asset purchases will end at the beginning of March
In the Fed's statement, it was emphasized that risks to the economic outlook remain, including new variants of Kovid-19.

In the reiterated statement that the Federal Open Market Committee (FOMC) aims to achieve the maximum employment and 2 percent inflation target in the long term, it was reported that it was decided to keep the target range for the federal funds rate between 0 and 0.25 percent in order to support these goals.

In the statement, it was stated that it was expected that it would be appropriate to increase the interest rate "soon", and that asset purchases would be terminated at the beginning of March.

Pointing out that the pace of reducing asset purchases is maintained at $30 billion, the statement emphasized that the bank will be ready to adjust its monetary policy stance appropriately in case of risks that may prevent it from reaching its targets.

On the other hand, the Fed, in another statement, stated that they agreed on the principles of balance sheet reduction and that the balance sheet reduction would begin after the interest rate hike.