Thursday, September 27, 2018

The Fed Speaks

The Federal Reserve raised interest rates on yesterday for the third time this year - and signaled they will raise rates again in December. The Fed's increase of the Fed funds rate to a range of 2 percent to 2.25 percent set the benchmark interest rate at its highest level since April 2008.

The Fed’s statement on Wednesday also included the release of updated economic projections. The most notable change is a steep upgrade in expectations for economic growth this year. Fed officials’ median forecast now calls for GDP growth to hit 3.1 percent in 2018, up from 2.8 percent in June’s projections and substantially higher than the Fed’s forecast for 2.5 percent GDP growth this year at the end of 2017.

The Fed described the economy as “strong,” writing that information since the Fed’s August meeting shows “the labor market has continued to strengthen and that economic activity has been rising at a strong rate.... Household spending and business fixed investment have grown strongly.”

No comments:

Post a Comment