Fed keeps key interest rates near zero, says economic recovery on track: Highlights

The Federal Reserve kept key policy rates unchanged at the end of a two-day meeting on Wednesday as widely expected, and maintained that the US economy remains on track despite a spike in coronavirus cases. The US central bank, however, offered no clues about when it will start to tighten its ultra loose monetary policy for the world's largest economy that it introduced in 2020 to battle the economic fallout from the pandemic.

The US job market still had "some ground to cover" before it would be time to pull back from economic support, Chairman Jerome Powell said after the much-awaited scheduled policy review. "Right now, it is not the ideal time to think about raising interest rates. Instead, the Fed is focusing on asset purchases," he said. He suggested that the Delta variant of the deadly virus poses little threat to the economy, at least so far.

For now, the central bank is purchasing $120 billion in Treasury and mortgage bonds each month to support the US economy.