Although the Asia-Pacific market performed strongly today, the Federal Reserve’s recent interest rate policy continues to affect the global financial pattern. On February 5, the Federal Reserve held a monetary policy meeting and announced that it would keep the federal funds rate unchanged in the range of 5.25%-5.5%. This is the fifth consecutive steady maintenance since the second half of 2025, which is completely in line with market expectations and provides clear policy guidance for the global financial market.
Federal Reserve Chairman Jerome Powell clearly stated at the post-meeting press conference that the current U.S. economy is operating stably, the job market is strong, and the unemployment rate is stable at a low level of 3.7%. However, the inflation level has not yet reached the 2% policy target, so it was decided to continue to maintain high interest rates to curb inflation rebound. Regarding the market’s concerned interest rate cut timetable, Powell did not give a clear answer, only implying that if inflation falls steadily in the second half of 2026, interest rate cuts may be gradually launched at a moderate pace.
After the announcement of the decision, the global financial market responded stably, showing the characteristics of “mild adjustment and structural differentiation”. The three major U.S. stock indexes closed slightly higher, with the Dow Jones Industrial Average rising 0.42% and the Nasdaq Composite Index rising 0.68%; the U.S. dollar index fell slightly, currently breaking below the 107 mark, a new low in three weeks, and non-U.S. currencies strengthened collectively.
Analysts believe that the Federal Reserve’s consecutive steady maintenance of interest rates not only stabilized domestic inflation expectations, but also eased policy uncertainty in the global market. The high interest rate environment will continue in the short term, which will continue to affect global capital flows. Emerging market currencies are expected to benefit from stable policy expectations and gradually ease the pressure of capital outflows. Investors need to focus on subsequent U.S. inflation and employment data to predict changes in interest rate cut nodes.
