The Federal Reserve, the US central bank, freezes the base rate of 1.50% to 1.75% on November 11 (local time).

After the end of three consecutive rate cuts since the end of July, the company entered freeze mode again.

The Federal Reserve said it would hold a regular meeting of the Federal Open Market Committee (FOMC), a two-day monetary policy meeting, to keep the Federal Fund Rate (FFR), the base rate for monetary policy, at the current 1.50-1.75% rate.

Although there is global uncertainty such as US-China trade disputes, we believe there is no reason to change interest rates given the relatively good economic conditions and labor market conditions in the US.

The Fed removed the statement “I will act appropriately to continue economic expansion” in its statement at the time of the rate cut in October, putting weight on the possibility of turning to interest rate freeze for the time being.

Indeed, Bloomberg's forecast of major investment banks (IBs) estimated that 100% of the 89 IBs expected to freeze interest rates at the FOMC.

The Fed lowered its interest rate to 0.00 ~ 0.25% in December 2008 during the global financial crisis, effectively dropping it to zero.

Since then, as the US has overcome the financial crisis and the economy has recovered, it has begun to raise interest rates for the first time in seven years in December 2015, returning to a tightening stance, nine times in 2016, three in 2017, and four last year. We raised interest rate.

However, due to US-China trade disputes, concerns over the global recession, and low-interest policies in major countries, Korea lowered its base rate for the first time in 10 years and 7 months at the end of July, and then cut 0.25 percentage points in September and October, respectively.

(yunhap news)