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Fed not expecting to raise rates until end of 2022

Investors eyeing whether some recent pieces of promising economic data might cause the Federal Reserve to accelerate a return to interest rate increases got their answer on Wednesday, when Fed officials said they expect to keep rates near to zero until at least the end of 2022. The Fed also reported its first set of economic projections in six months, predicting that the US economy will contract by 6.5 this year, and unemployment falling back to 9.3. Chairman Jerome Powell said that were not even thinking about thinking about raising rates, indicating that the central bank sees a long battle ahead to tackle the economic fallout from the pandemic. The Federal funds rate entered the year at around 1.5, and was taken down to near zero in two cuts made in short succession during March. Yesterday, Powell said that the Fed is strongly committed to using all of the tools at its disposal to provide economic stability and relief, and played down last weeks figures that showed 2.5 million jobs were unexpectedly added to the economy in May.