Investors will pay close attention to any potential ripple effects in the Emerging Markets caused by U.S.
Fed rate policy.
Not exact matches
So - called «dollar - sphere» markets have monetary
policy that is at least partly outsourced to the
Fed, and by extension are vulnerable to
rate hikes.
«Job gains have been solid in recent months and the unemployment
rate has declined,» the
Fed said in its
policy statement.
Fed chair Janet Yellen on December 2 stated as clearly as central bank lexicon will allow that she will recommend raising America's benchmark interest
rate when she convenes the
policy - setting Federal Open Market Committee later this month.
The
Fed's decision to edge off of a crisis - level
rate policy was long anticipated and experts say this first
rate hike in nearly a decade might not have much of an impact overall.
Rather than the
Fed pursuing a
policy resulting in some steady
rate of growth in the money supply, I would suggest that the
Fed attempt to produce a steady
rate of growth in the sum of the credit it creates and the credit created by depository institutions, i.e., commercial banks, savings associations and credit unions.
If the
Fed were to adopt an operating
policy of achieving a steady
rate of growth in nominal thin - air credit, it could return to its prior anonymity.
However, looking at DHS data on the arrest
rate of illegal entrants at the Mexican border, Federico S. Mandelman, a research economist and associate
policy adviser at the Federal Reserve Bank of Atlanta, and Andrei Zlate, a senior financial economist in the Boston Fed's Risk and Policy Analysis Unit, found the numbers have been plumm
policy adviser at the Federal Reserve Bank of Atlanta, and Andrei Zlate, a senior financial economist in the Boston
Fed's Risk and
Policy Analysis Unit, found the numbers have been plumm
Policy Analysis Unit, found the numbers have been plummeting.
Bernanke himself made clear Monday, as he has in the past, that the
Fed's low -
rate policies are no panacea for the economy.
But at that point, the
Fed chair Janet Yellen and the other members of the interest
rate - setting committee seemed to side with the idea that Trump's
policies would do more to help the economy than hurt it.
The Federal Reserve, long hesitant to raise U.S. interest
rates, increasingly faces risks if it waits too much longer so a gradual
policy tightening is likely appropriate, a top
Fed official said on Friday.
Also, notwithstanding a silly fiscal
policy and the ongoing political impasse, the U.S. economy has some very good things going for it now, as even king of doom, Nouriel Roubini, couldn't help but note: the
Fed is going to stick to its asset - buying regime for the foreseeable future, providing a monetary protein shake the recovery still very much needs; the housing rebound is well on its way, which is helping Americans rebuild their wealth and is boosting employment in many states with high jobless
rates; and the shale oil and gas revolution continues to power investment, job creation and revenue growth.
The
Fed's low interest
rate policy has driven more and more money into bond funds as investors search for higher yields.
Critics have worried that the
Fed has missed opportunities to normalize
policy, but Yellen said «the risk of falling behind the curve in the near future appears limited, and gradual increases in the federal funds
rate will likely be sufficient to get to a neutral
policy stance over the next few years.»
The divergence in
policy between the U.S. Federal Reserve and the Bank of Canada is happening: the
Fed likely will raise interest
rates at least a few times in 2017, while the Canadian central bank likely will do nothing at all.
But that doesn't mean that the
Fed needs to now commit to a
policy of even slow - but - steady
rate increases in the months and years ahead.
The 30 - day
Fed Fund futures can be used as a guide to predict when the
Fed might increase interest
rates since the prices are an expression of trader's views on the likelihood of changes in U.S. monetary
policy.
The
Fed under Yellen has carefully stripped its
policy statement of most future - oriented promises to keep
rates low, along with ending crisis - era asset purchase programs.
That expected stimulus has led several policymakers to say the
Fed will likely raise
rates more quickly, but Powell said new
policies could also ease the
Fed's burden.
In a recent speech to the Providence Chamber of Commerce,
Fed Chair Janet Yellen said, «I think it will be appropriate at some point this year to take the initial step to raise the federal - funds
rate target and begin the process of normalizing monetary
policy.»
Seen as one of the most important members of the
Fed's
rate - setting committee, Dudley said the central bank was in no rush to tighten monetary
policy.
That debate takes place internally at the central bank, where contrasting views are regularly articulated by members of the Federal Open Market Committee (FOMC) as our Federal Reserve (
Fed) policymakers attempt to steer monetary
policy with regard to interest
rates.
Weighed against unemployment, which has dropped to a 16 - year low at 4.1 percent, that weakness has puzzled economists and made some
policy makers declare the
Fed should hold off on additional
rate increases until prices respond more briskly.
I do think, as you put it before, that the equity market does rely on us having somewhat lower
rates and the
Fed normalizing
policy fairly gradually.
In his job as an activist at the Center for Popular Democracy, Barkan led a successful effort to get
Fed officials thinking more about low - income Americans as they conduct monetary
policy, often arguing against interest
rate hikes in the face of high underemployment and weak wage growth.
While the
Fed has indicated it plans to raise short - term interest
rates, the uncertain domestic and global economies and the still - loosening monetary
policy of central bankers in other countries suggests that
rates could remain very low for a long time still.
As the
Fed policy meeting threw up no surprises with
rates left unchanged, the focus shifted back to simmering trade tensions...
The
Fed has been working to normalize monetary
policy over the past two years, beginning with its initial move off historically low, near - zero
rates in December 2015.
But now an interest
rate hike could be off the table, given that the
Fed is likely to think that Trump's
policies will add risk to the U.S. economy and global markets on their own.
It took longer than anyone thought it would, but the
Fed's post-crisis
policy of putting maximum downward pressure on interest
rates finally is paying off.
The
Fed ended its latest
policy meeting by leaving its key short - term
rate unchanged at 1.5 percent to 1.75 percent, the level it set in March after its sixth
rate increase...
That means the
Fed will likely have to get more, rather than less, aggressive in its efforts to «normalize» interest
rate policy.
The
Fed, Wednesday's statement notwithstanding, will likely have to get more, rather than less, aggressive in its efforts to «normalize» interest
rate policy.
CHANGE AT THE
FED: Investors have generally expected a smooth transition from Janet Yellen to Jerome Powell as Fed chair, with little difference in approach to rate poli
FED: Investors have generally expected a smooth transition from Janet Yellen to Jerome Powell as
Fed chair, with little difference in approach to rate poli
Fed chair, with little difference in approach to
rate policy.
Particularly during the period of extraordinary
policy accommodation — low interest
rates and $ 3.7 trillion of bond buying — the
Fed sometimes has struggled to communicate its intentions.
The
Fed reckons U.S. gross domestic product could expand by as much as 2.7 % in 2016, which would be considerably faster than the
rate of growth — roughly 2 % — that
policy makers think the American economy can handle without stoking inflation.
More than half of the members of the
Fed's policy committee predict the fed funds rate will be no higher than 2 % at the end of next ye
Fed's
policy committee predict the
fed funds rate will be no higher than 2 % at the end of next ye
fed funds
rate will be no higher than 2 % at the end of next year.
Again, as many as three
rate hikes are expected in 2017 — unlike the one this year — with
Fed Chair Janet Yellen commenting that economic conditions have improved well enough to warrant a more aggressive
policy.
In our view, t he
Fed would be highly likely to adjust the
policy rate upwards in this situation to avoid further market distortions and a potential explosion in carry trade and other counterproductive
rate arbitrage activity.
If Yellen's
Fed fails to convince Wall Street about the
policy path, a
rate increase could trigger financial turmoil of the sort seen in 2013, when investors were caught off guard by the central bank signaling an end to its bond - buying program.
Until recently, he has focused on more tangential issues for the
Fed — like the regulation of scandal - ridden Libor interest
rates, financial innovation, and housing
policy.
New York
Fed President William Dudley said last week a
rate hike would be possible at the
Fed's next
policy meeting in September.
The U.S. Federal Reserve is likely to continue removing
policy accommodation gradually and could hike
rates three times this year, Dallas
Fed President Robert S. Kaplan told a business conference in Frankfurt on Thursday.
The
Fed has been suggesting it could raise
rates in 2016 since it tightened
policy in December for the first time in nearly a decade, but investors have doubts the central bank will follow through on that guidance.
«This would offset the impact of a decline in the long - run neutral real
rate of interest by giving the (
Fed) more «
policy space» to respond to adverse shocks,» Kocherlakota said.
Julia Coronado, a former
Fed economist and founder of MacroPolicy Perspectives, says Powell's greater familiarity with banking and finance than monetary
policy makes him more likely to follow the consensus, often driven by staff forecasts, on interest
rate policy.
The
Fed had to push markets by specifically mentioning in its
policy statement last October that it might raise
rates at its «next meeting» in December.
The
Fed raised its key overnight lending
rate in December for the first time in nearly a decade, but it has backed away from further monetary
policy tightening this year largely due to a global economic slowdown and financial market volatility.
Analysts who follow the
Fed complain that its framework has become confusing: low unemployment and inflation close to the 2 % target would not seem consistent with a
policy rate more aligned to a recession.
A few
Fed policymakers worry the U.S. economy, which has delivered strong job gains but worryingly weak
rates of inflation, could be stuck on a low growth path that requires low
rates for years as well as new
policy tools.