Fed Holds Rates, Signals Inflation Fight Continues

The US Federal Reserve kept its benchmark interest rate unchanged for a fifth consecutive meeting on Wednesday, maintaining the federal funds rate in the 3.50%-3.75% range.

The decision was widely expected but signalled that inflation remains a concern, with three policymakers dissenting in favour of a 25-basis-point rate hike.

Higher US interest rates make American assets relatively more attractive, reducing the incentive for foreign investors to allocate money to emerging markets, such as India.