Fed holds benchmark interest rate at 3.75–4.00%

The Federal Reserve held its benchmark interest rate steady at 3.75–4.00% on Wednesday (local time).

The Fed announced the decision after concluding a two-day Federal Open Market Committee meeting. The FOMC convened within a month of raising the benchmark rate by 0.25 percentage points last month, opting this time to leave rates unchanged.

While inflation and a stronger-than-expected US economy have been cited as factors that could justify further increases, the Fed paused to assess the effects of its previous hike before moving ahead with additional tightening.

The Fed had earlier signaled the possibility of another increase this year, raising the likelihood of a rate hike at the final FOMC meeting of the year, scheduled for Dec. 8–9.

With the Fed holding rates steady, the gap between US and South Korean benchmark rates — South Korea's currently at 3.00% — remained at 1.00 percentage point, based on the upper bound of the US range.