‘Outrageous’ used car prices amid highest inflation in 13 years

By Anneken Tappe, CNN Business

The Federal Reserve left interest rates and monetary policy unchanged on Wednesday, pointing to the nation’s as yet incomplete economic recovery.

“The path of the economy continues to depend on the course of the virus,” the central bank said in a statement. While vaccinations are helping to limit the virus and its impact on the economy, the risk to the economic outlook still remains.

The Fed, which each month currently buys Treasury securities worth $80 billion and mortgage-backed securities worth $40 billion, noted that the economy has made a lot of progress since this policy has been put into place.

“The Committee will continue to assess [the] progress in coming meetings,” according to the statement, hinting at the central bank getting ready to taper its asset purchases.

“This is ever so slightly more hawkish than expected but there’s not much new for investors to see here, said James McCann, deputy chief economist at Aberdeen Standard Investments, in emailed comments.

But the summer meeting was never the place the central bank was going to shake things up too much, McCann added.

“Powell’s job at the moment is like trying to turn a cruise ship in a bath tub. He has very little room for maneuver and wants to avoid any sharp turns at the risk of unsettling markets,” he said.

Meanwhile the Fed announced the establishment of two repurchasing, or repo, facilities, one for domestic markets and the other for foreign and international central banks. The facilities will ensure that the plumbing of the financial sector functions smoothly.

Fed Chairman Jerome Powell will hold a press conference at 2:30pm ET.

This is a developing story. It will be updated.

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