mardi 17 mars 2015
5 Things To Watch In The Fed's March Meeting
Posted on 13:21 by nice news
1 The Policy Statement
The committee is likely to strike the “patient” pledge from its policy statement, which would formally open the door to the possibility of a rate increase in June. Watch to see if it provides any other verbal guidance on the outlook for interest rates. The Fed could say, as Ms. Yellen did in recent congressional testimony, that it won’t start raising its benchmark short-term rate from near zero until it is “reasonably confident” inflation will move back toward the central bank’s 2% target. Employment Forecasts
In December, Fed officials forecast the unemployment rate to be 5.2% to 5.3% by the end of this year. Since the rate was 5.5% in February, expect them to lower that estimate. Normally, that would imply they could raise interest rates sooner. But watch whether they also lower their estimates for the long-term unemployment rate. In December they pegged the range for the long-term rate at 5.2% to 5.5%. If they nudge that range lower, they could be comfortable letting joblessness keep falling for longer before raising rates.
The committee is likely to strike the “patient” pledge from its policy statement, which would formally open the door to the possibility of a rate increase in June. Watch to see if it provides any other verbal guidance on the outlook for interest rates. The Fed could say, as Ms. Yellen did in recent congressional testimony, that it won’t start raising its benchmark short-term rate from near zero until it is “reasonably confident” inflation will move back toward the central bank’s 2% target. Employment Forecasts
In December, Fed officials forecast the unemployment rate to be 5.2% to 5.3% by the end of this year. Since the rate was 5.5% in February, expect them to lower that estimate. Normally, that would imply they could raise interest rates sooner. But watch whether they also lower their estimates for the long-term unemployment rate. In December they pegged the range for the long-term rate at 5.2% to 5.5%. If they nudge that range lower, they could be comfortable letting joblessness keep falling for longer before raising rates.
5 Things To Watch In The Fed's March Meeting
Categories: 5 Things To Watch In The Feds March Meeting
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