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The U.S. Federal Reserve Has Decided To Maintain The Federal Funds Rate Unchanged From 0 To 0.25% / U.S. Finally Takes Responsibility For climate change

The U.S. Federal Reserve Has Decided To Maintain The Federal Funds Rate Unchanged From 0 To 0.25%

The U.S. Federal Reserve decided the interest rate, for now, remains unchanged from 0 to 0.25% at a meeting on 2:00 am on Thursday and maintains monthly debt purchases of US 120$billion. If the overall economic indicators continue to stay strong and the development is generally in line with expectations, it will be determined that the scale of debt purchases will be reduced soon.  
In that case, the Fed's plan of raising interest rates will become earlier than originally expected. There are 9 of the Fed members estimated the interest rates will rise in 2022. Which has increased from June with 7 members. Therefore, the interest rate can be increased by 0.25% in 2022 at the earliest, and 0.75% in 2023.

According to the latest prediction from the Federal Reserve, the US domestic production forecast (GDP) growth is 5.9%, which is lower than the 7% estimated in June, and will grow by 3.8% next year; Unemployment rates for this year and next are expected to be 4.8% and 3.8% respectively. As for the inflation index that the bureau attaches importance to, the Core Personal Consumption Expenditure Deflator(Core PCE) is forecast to rise 3.7% this year, which is higher than the 3% expected in June and is expected to rise 2.3% next year. It is also expected that the US inflation rate this year will reach 4.2%, which is more than twice the Fed’s 2% target.

However, some people in the market are worried that they are in a debt trap, because with the current debt level, when the central bank gradually withdraws from unconventional monetary policy, it will find that stock bonds, credit markets, and the economy are at risk of collapse, and the maximum decline may be as much as 20%. It is believed that the valuations of all assets are currently high, and the market is full of uncertain factors including the Evergrande crisis. Earnings and economic data may be disappointing, which will exacerbate the stock market decline.

U.S. Finally Takes Responsibility For climate change

The issue of climate change has existed for a long time, for example, from the "Kyoto Protocol" to the "Paris Climate Agreement." except for the United States repeatedly quitting the agreement, most of the developed countries and some of the emerging countries have agreed to reduce emissions. For example, in the Paris climate meeting of 2015, when most countries are willing to limit their increase in emissions to within 2 degrees from Celsius in the pre-industrial era and strive to reduce the standard to within 1.5 degrees Celsius. The U.S. withdraws from the Paris climate agreement on 1 June 2017. Because reducing emissions means reducing the use of fossil fuels if there is no more advanced or cleanability to use, which will also have an impact on the industry and various industries. Until new research found that more and more extreme cold and severe winter weather in parts of the United States is related to accelerated warming in the polar regions. Therefore, on January 20, 2021, the United States was forced to return to the Paris Agreement. Therefore, when Biden promised in his speech that the US carbon emissions in 2030 will be reduced by 50 to 52% compared to 2005, It also Announces that the United States will achieve its net-zero emission target by 2050 because this target is difficult to achieve and the US did quit the agreement many times before which makes many countries doubt Washington's commitment. Also, Xi Jinping announced that carbon emissions will reach a peak by 2030 and achieve the goal of carbon neutrality by 2060. but since there are differences between the United States and China, it is unknown whether the two will reach cooperation on climate issues.
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