The Federal Reserve will leave interest rates unchanged today and will retain its easing bias, according to analysts. The central bank has held rates at a 45-year low of 1.0pc since June, when it lowered borrowing costs by 25 basis points. It has cut its target rate 13 times since January 2001 - lowering the rate from 6.5pc - to boost the economy. With the rate decision almost certain, the market is focussing on the policy statement and the phrase, used by the Fed after the last meeting in October, that rates will remain on hold for a "considerable period of time".
"We expect the Fed to maintain its easing bias but, with the US economy continuing to pick-up pace, there may be a subtle change in the language used," said Geraldine Concagh, senior economist at AIB Treasury. "The general expectation is that the central bank will start to move away from its commitment to keep rates accommodative 'for a considerable period' of time". Even if the Fed drops the "considerable period" reference, economists generally believe that the essential message this evening will still be that the Fed has no immediate plans to raise rates from their current level. //www.fxcentre.com