The Federal Reserve expects to hold interest rates near zero through 2023 to bolster U.S. economy. FOX Business’ Edward Lawrence with more.
U.S. equity markets rallied, then cooled off to closed mixed, after the Federal Reserve enacted its plan to keep interest rates low through at least 2023 to support the economy as it normalizes following the sharpest economic slowdown of the post-World War II era.
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The tech-heavy Nasdaq Composite, paced the selling, over 1.2% led by the likes of Apple and Amazon.
The Dow Jones Industrial Average gave up a triple point lead to end the session little changed, while the S&P 500 fell 0.46%.
The Federal Reserve kept its benchmark interest rate between 0% and 0.25% and said inflation would be allowed to overshoot the central bank’s 2% target “for some time.” The strategy was laid out last month at the Fed’s virtual Jackson Hole Symposium conference.
During the Q&A Fed Chair Jerome Powell reiterated it may take some time for unemployment levels to return to pre-COVID levels and more fiscal and monetary stimulus may be needed.
Even with the late day pullback, financial stocks maintained gains with borrowing costs expected to stay favorable for the U.S. consumer.
Energy shares also gained as Hurricane Sally produced two feet of rain as it made landfall on the Alabama coast and worked its