US economic recovery ‘making progress’, says Fed

The US central bank has said that the economy is making progress due to widespread vaccinations.

The Federal Reserve kept interest rates on hold near zero, saying that inflation largely reflected factors that would pass in time.

While jobs growth and the economy had strengthened, “risks to the economic outlook remain”, it said.

The central bank will continue to monitor economic progress before easing pandemic support.

The announcement, following the end of its two-day meeting, comes amid concerns that rising prices could prompt the Fed to push up interest rates, increasing the cost of borrowing for businesses and consumers.

Inflation, which measures the rate at which the prices for goods and services increase,continued to surge in the US in June continued to surge in the US in June  as the cost of energy and used cars in particular increased.

Consumer prices jumped 5.4% in the 12 months to the end of June, up from 5% the previous month.

It marked the biggest 12-month increase since August 2008, according to the US Labor Department.


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