By Liz Moyer
Investing.com -- Federal Reserve members continued to back accommodative monetary policy measures to keep the economic recovery on solid footing amid ongoing worries about the impact of the Covid-19 pandemic, according to the July meeting minutes released Wednesday.
At the conclusion of its previous meeting on July 30, the Fed kept its benchmark rate unchanged in range of 0% to 0.25% and stressed that rates would be kept near-zero until it was "confident that the economy has weathered recent events." At the meeting, Fed officials discussed the ongoing economic fallout of the viral pandemic, which shut down businesses and cost millions of Americans their jobs.
Markets surged ahead of the release of the minutes. Traders and investors were looking for any changes to the central bank's thinking on the economic recovery, especially given improved jobs and other economic data that has come out since the Federal Open Market Committee's meeting last month.
The Fed has pledged not to raise rates anytime in the near future, until inflation and employment numbers hit their mark. The central bank set a policy of average inflation of around 2%, but appears ready to accept a rate higher than that level. Right now, inflation hovers around 1%, according to the Labor Department's latest measure.
While short-term rates are targeted near zero, longer-term real interest rates have turned negative. That has sent the price of gold soaring to a record above $2,000 an ounce while the dollar has tumbled against other world currencies.
What remains to be seen is whether the Fed will be more accommodative than it was even after the financial crisis. Twelve years ago, the Fed cut rates to zero and held them there for six years, long after the economy and markets had recovered.