Fed holds policy steady as US Presidential election hangs in balance

 

Results from Tuesday's presidential vote were still being tabulated in a few key states, though Democratic nominee Joe Biden was near the number of electoral votes needed to win the White House.

US Election 2020: The Federal Reserve kept its loose monetary policy intact on Thursday and pledged again to do whatever it can in coming months to sustain a US economic recovery threatened by a spreading coronavirus pandemic and facing uncertainty over a still undecided presidential election.

Results from Tuesday's presidential vote were still being tabulated in a few key states, though Democratic nominee Joe Biden was near the number of electoral votes needed to win the White House.

The US central bank did not speak about the election in a policy statement released after its latest two-day meeting, but Fed Chair Jerome Powell is likely to address any concerns about the weeks ahead in a news conference at 2:30 p.m. EST (1930 GMT).

"Economic activity and employment have continued to recover but remain well below their levels at the beginning of the year," the central bank's policy-setting Federal Open Market Committee said in a unanimous statement, which left the central bank's key overnight interest rate unchanged at near zero. "The Covid-19 pandemic is causing tremendous human and economic hardship across the United States and around the world."

In a statement virtually unchanged from the one issued at its September policy meeting, the Fed repeated its pledge to use its "full range of tools" to support the economy, and promised not to consider raising interest rates until maximum employment had been restored and inflation was heading above its 2 per cent target.

The Fed said it would for now continue buying "at least" $120 billion per month in government bonds, and use its other tools and programs as needed depending on how the economy evolves.