Fed holds rates, room for future cuts

The Federal Reserve has defied market expectations for a cut, opting to keep interest rates on hold at Tuesday's monetary policy meeting.

Until the end of the last week, the markets fully expected rates to remain on hold. The outlook changed sharply over the weekend and on Monday following the dramatic deterioration in financial markets.

In the hours preceding the meeting of the Federal Open Markets Committee (FOMC) on Tuesday, interest-rate futures markets were pricing in with near certainty t