US Fed holds interest rate steady, but signals rate hike "soon" to fight inflation

U.S. Federal Reserve Chair Jerome Powell said on Wednesday that the Fed is holding its policy interest rate near zero, but an expected hike would "soon be appropriate."

It plans to begin raising its benchmark interest rate as soon as March, a key step in reversing its pandemic-era low-rate policies that have fueled hiring and growth but also escalated inflation.

Powell also stated that the economy expanded at a “robust pace” in 2021 due to progress on COVID-19 vaccinations and the reopening of the economy amid the pandemic. Plus, the Omicron variant might lead to slowed growth this quarter, but as the wave dies down, the economy should recover, he said.

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