FOMC Statement & Projections
March 15, 2017
The FOMC hiked its fed funds rate target 25 basis points to 0.74-1.0%. There was a single dissent, Minneapolis Fed President Kashkari, who favored no change. The released statement is similar to the prior one. Business investment was upgraded, and the statement acknowledges that the desired level of inflation has been reached, so the goal now becomes one of stabilizing such around there. Released projections showed the same 2.1% growth expected this year but bumped up 2018 to a 2.1% pace from 2.0%. Inflation forecasts are the same as before, and so essentially is the projected end-year level of the federal funds rate, which is 1.4% this year, 2.1% next year and 3.0% in 2019. The longer run estimated neutral fed funds rate hasn’t changed, either.
Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without express permission.