Why has the US Fed decided to keep interest rates unchanged & how has it affected the Indian economy?
Why has the US Fed decided to keep interest rates unchanged & how has it affected the Indian economy?
In an attempt to deal with ‘Elevated’ inflation in the American economy, the US Federal Reserve has decided to keep the interest rates unchanged. This decision was taken at a recent Central Bank of America meeting, which Jerome Powell, the Chair of the Federal Reserve, led.
To help you understand a few basic facts about the US Fed and their decision to keep interest rates unchanged and its effect on the Indian market here is a ‘Loan Bazaar’ article.
What happened when the US Fed met up?
During the meeting, it was also decided that there would be rate cuts of three-quarters of a percentage point by the end of 2024.
However, this move by the US Fed is a clear indication that the policymakers intend to prevent the inflation rate in the country from increasing above the 2% inflation target.
Why did the US Fed decide to go against rate cuts?
It was economic projections that exhibited an increase in personal consumption expenditures (not including food and energy) price to 2.6% from 2.4% in an earlier projection, which has compelled the US Fed to keep interest rates unchanged so that they can effectively manage inflation.
How is the US Fed looking to deal with interest rate cuts in the next few months?
The US Federal Reserve is all set to meet again in June. So, during the next few months, several inflation readings are expected. This could lead to several changes including softer inflation readings stimulating expectations at the beginning of interest rate cuts. There is also a possibility of stronger inflation readings to push rate cuts further.
What effect will the US Fed’s decision to keep the interest rate unchanged have on the Indian economy?
Since the US Fed has decided not to cut interest rates only means that they will continue to remain high. With election season arriving in India no significant changes in interest rates have been made by the Reserve Bank of India (RBI).
A reason why the RBI has followed the US Fed and avoided any interest rate cut. It means that at the existing repo rate of 6.50% taking a home loan for an Indian will be affordable as there has been no hike in it.
In such a scenario then if you are looking to buy a ‘Dream House’ it is the right time to do so. With a fintech brand ‘Loan Bazaar’ is available to help you get a home loan at the lowest interest rate possible.
To learn more about how you can get the cheapest home loan possible and about personal loans and credit cards please click the link https://loanbazaar.net.in/ and get the right guidance.
