Federal Reserve, 4consecutive rate hold…dot plot shifts to a rate hike within the year
The Federal Reserve 17kept its policy rate at 3.50~3.75%. The dot plot shifted from a forecast of a rate cut within the year to a forecast of a hike, and markets are leaning toward there being no further cuts this year. The year-on-year increase in consumer prices exceeded 4% last month.
The Federal Reserve announced that after its two-day Federal Open Market Committee (FOMC) meeting on 17 (local time), it would keep the target range for the policy rate at 3.50~3.75%.
With this decision, the Federal Reserve has kept its policy rate unchanged for 4consecutive meetings. The statement was released immediately after the meeting.
The interest-rate projections of Federal Reserve officials, known as the dot plot, have changed. The forecast that had anticipated a rate cut within the year shifted toward a hike.
The market is increasingly leaning toward the view that the possibility of additional cuts within the year is low. Market participants believe that the previous easing trend will not continue this year.
The Federal Reserve 9from 12through 25bp at a time on three occasions before switching to a hold from 1this year.
Inflation data also stand out. The year-on-year increase in consumer prices exceeded 4% last month.
The changes in this statement and the dot plot have again raised interest-rate expectations across financial markets. The Federal Reserve will reassess its policy stance based on the next meeting and the trend in economic indicators.
Sources: 연합인포맥스
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