Date
29 March 2017
The US Federal Reserve, led by its chairwoman Janet Yellen, is in a holding pattern on interest rates amid uncertainties stemming from the Brexit vote. Photo: Reuters
The US Federal Reserve, led by its chairwoman Janet Yellen, is in a holding pattern on interest rates amid uncertainties stemming from the Brexit vote. Photo: Reuters

Brexit vote prompted Fed to stay pat on rates: minutes

US Federal Reserve officials decided that interest rate hikes should stay on hold until they get a clear picture on the consequences of Britain’s vote on EU membership, according to minutes of the central bank’s June policy meeting.

The minutes of the June 14-15 meeting, which took place ahead of the June 23 referendum in which Britons voted to leave the European Union, showed widespread unease over the so-called Brexit vote, Reuters reported.

“Members generally agreed that, before assessing whether another step in removing monetary accommodation was warranted, it was prudent to wait for additional data on the consequences of the UK vote,” according to the minutes released Wednesday.

At the June policy meeting, policymakers also cited a severe slowdown in hiring by US employers as a reason for leaving interest rates steady.

The Brexit vote shocked investors and triggered US$2 trillion in losses in global stock markets the day after the referendum.

On Wednesday, US benchmark and long-dated Treasury yields hit record lows, with some investors betting the Fed would keep rates on hold through 2017.

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