The Federal Reserve is keeping interest rates unchanged, a move which will likely put a smile on the face of real estate players.
The Fed announced the policy statement on Jan. 27, Wednesday. With the market falling in the new year, all waited for what pace the central bank will set, as reported by The Real Deal.
It could indicate that the economic momentum is slowing down again if the Fed decides to move more hesitantly than expected on interest rates.
The announcement was closely watched as the Fed chose to increase short-term interest rates in December by 25 points, as expected by many in the real estate industry. However, the market turmoil this year has brought a question whether the increase was the right move.
The stocks that have had a rough start to the new year may experience more pressure if the central bank maintains its December outlook with another hike on rates. But it could only show that the economy is not doing as well as before if the Fed proposed its pace of tightening will be slower than expected.
According to Reuters, the Feds kept the interest rates to closely monitor global economic and financial developments. A sign that had been considered for a selloff on stock market but was not ready to desert a plan to increase monetary policy this year.
Even with "gradual" rate increases, the Fed policymakers said that the economy was still on course for moderate growth and a stronger labor market. It suggests that its concern about global events had decreased but not blocked chances of a rate increase in March.
"The committee is closely monitoring global economic and financial developments and is assessing their implications for the labor market and inflation," the Fed said in its policy statement after a two-day meeting.
