A look at how the Fed’s views have changed on the economy and its interest rate policies

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A comparison of the Federal Reserve’s statements from its two-day meeting that ended Wednesday and its meeting Jan. 28-29:

INTEREST RATES:

Now: The Fed has become less specific about when it will raise its benchmark short-term interest rate: “The Committee will assess progress — both realized and expected — toward its objectives of maximum employment and 2 per cent inflation. This assessment will take into account a wide range of information, including measures of labour market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments.”

Then: Low interest rates “will be appropriate at least as long as the unemployment rate remains above 6 1/2 per cent, inflation between one and two years ahead is projected to be no more than a half percentage point above the Committee’s 2 per cent longer-run goal, and longer-term inflation expectations continue to be well anchored.”

ECONOMY:

March: Its assessment of the economy is weaker: “Information received since the (Fed) met in January indicates that growth in economic activity slowed during the winter months, in part reflecting adverse weather conditions.”

January: “Information received since the (Fed) met in December indicates that growth in economic activity picked up in recent quarters.”

POLICY GOALS:

March: The Fed has added a new sentence: “The change in the (Fed’s) guidance does not indicate any change in (its) policy intentions as set forth in its recent statements.”

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