At 3:00 Beijing time on Thursday, the US Federal Open Market Committee (FOMC) announced its latest interest rate decision, leaving the benchmark interest rate in the range of 0%, the excess reserve ratio (IOER) at 0.1% and the discount rate at 0.25%, in line with market expectations. The meeting is the Fed's last policy meeting of the year.

The Fed said it would continue to buy bonds until substantial progress was made on its target. The Fed said it expects GDP to shrink less in 2020 than it forecast in September, but will grow faster in 2021 and 2022 than it forecast in September. In addition, the Fed's median forecast shows that interest rates will remain near zero until the end of 2023.

Specifically:

The median forecast for GDP growth at the end of 2020 is-2.4%, compared with-3.7% in September.

The median forecast for GDP growth at the end of 2021 is 4.2%, compared with 4% in September.

The median unemployment rate is expected to be 6.7% at the end of 2020 and 7.6% in September.

The median unemployment rate is expected to be 5.0% at the end of 2021 and 5.5% in September.

The median inflation forecast for PCE at the end of 2020 is 1.2%, compared with 1.2% in September.

The median PCE inflation forecast is 1.8% at the end of 2021 and 1.7% in September.

The median federal funds rate is expected to be 0.1% at the end of 2020 and 0.1% in September.

The median federal funds rate is expected to be 0.1% at the end of 2021 and 0.1% in September.

The Fed bitmap shows that the Fed is expected to keep interest rates at current levels until 2023, the same as in September.

The Fed's FOMC statement said economic activity and employment continued to recover. The COVID-19 epidemic posed a considerable risk to the medium-term economic outlook and reaffirmed its commitment to using all tools to support the United States economy.

The Fed said it expected interest rates to remain at current levels until the labour market met the full employment assessment, with inflation rising to 2 per cent and expected to be moderately above that level for some time.

The Fed also extended temporary dollar swap arrangements and buyback facilities, but did not adjust the composition and speed of asset purchases.