The Federal Reserve kept interest rates unchanged Wednesday and said it’s closely monitoring global economic and market turmoil, but gave no signal that it’s retreating yet from plans to raise rates gradually this year. An increase was not expected Wednesday after the Fed lifted its benchmark rate last month for the first time in nearly a decade -- by a modest quarter-percentage point -- and said it aims to nudge up the rate slowly the next few years amid tepid economic growth. Some analysts expected the Fed to hint that even a March hike had become less likely after this month’s troubling news about China’s slowdown, sharp fall in stock and oil prices, and concerns that the 6 ½-year-old U.S. recovery may be petering out. Adding to that mindset is that the cheap crude and a strengthening dollar have further pushed down meager inflation. In a statement after a two-day meeting, the Fed said it’s “closely monitoring global economic and financial developments and is assessing their implications for the labor market and inflation, and for the balance of the risks to the outlook.” The comment suggests the Fed is taking a wait-and-see approach to the recent troubles, but isn’t yet backtracking from plans to gradually boost interest rates. Last month, the Fed provided a more upbeat view, saying the risks to its economic and labor market outlook were “balanced.” On Wednesday, it didn't say risks had shifted to the downside but did note it's keeping a close eye on the overseas troubles.
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