Fed Leaves Rates Unchanged, Inflation Continued Concern
The fed left rates unchanged as expected.
The Federal Open Market Committee decided today to keep its target for the federal funds rate at 2 percent.
Recent information indicates that overall economic activity continues to expand, partly reflecting some firming in household spending. However, labor markets have softened further and financial markets remain under considerable stress. Tight credit conditions, the ongoing housing contraction, and the rise in energy prices are likely to weigh on economic growth over the next few quarters.
The Committee expects inflation to moderate later this year and next year. However, in light of the continued increases in the prices of energy and some other commodities and the elevated state of some indicators of inflation expectations, uncertainty about the inflation outlook remains high.
The substantial easing of monetary policy to date, combined with ongoing measures to foster market liquidity, should help to promote moderate growth over time. Although downside risks to growth remain, they appear to have diminished somewhat, and the upside risks to inflation and inflation expectations have increased. The Committee will continue to monitor economic and financial developments and will act as needed to promote sustainable economic growth and price stability.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Donald L. Kohn; Randall S. Kroszner; Frederic S. Mishkin; Sandra Pianalto; Charles I. Plosser; Gary H. Stern; and Kevin M. Warsh. Voting against was Richard W. Fisher, who preferred an increase in the target for the federal funds rate at this meeting.
The Fed speak, as usual, makes it difficult to determine if they will raise rates come this fall, but inflation numbers are clearly a top priority on their agenda.
Inflation is an enemy to us all, and particularly to mortgage rates. The 10-Year Treasury yield took a bump up on the Fed decision. We'll have to keep a close eye on inflation numbers in the remaining year.
On the bright side, if inflation numbers do get better in the third quarter, we could experience a dramatic shift in mortgage rates to the lower side. The key is definitely a lowering of energy costs. Crude oil has gone straight up this year and you know what they say.... what goes up must come down. We hope!
May the Mortgage Rates be with You!
Refinance Tool Box
The Federal Open Market Committee decided today to keep its target for the federal funds rate at 2 percent.
Recent information indicates that overall economic activity continues to expand, partly reflecting some firming in household spending. However, labor markets have softened further and financial markets remain under considerable stress. Tight credit conditions, the ongoing housing contraction, and the rise in energy prices are likely to weigh on economic growth over the next few quarters.
The Committee expects inflation to moderate later this year and next year. However, in light of the continued increases in the prices of energy and some other commodities and the elevated state of some indicators of inflation expectations, uncertainty about the inflation outlook remains high.
The substantial easing of monetary policy to date, combined with ongoing measures to foster market liquidity, should help to promote moderate growth over time. Although downside risks to growth remain, they appear to have diminished somewhat, and the upside risks to inflation and inflation expectations have increased. The Committee will continue to monitor economic and financial developments and will act as needed to promote sustainable economic growth and price stability.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Donald L. Kohn; Randall S. Kroszner; Frederic S. Mishkin; Sandra Pianalto; Charles I. Plosser; Gary H. Stern; and Kevin M. Warsh. Voting against was Richard W. Fisher, who preferred an increase in the target for the federal funds rate at this meeting.
The Fed speak, as usual, makes it difficult to determine if they will raise rates come this fall, but inflation numbers are clearly a top priority on their agenda.
Inflation is an enemy to us all, and particularly to mortgage rates. The 10-Year Treasury yield took a bump up on the Fed decision. We'll have to keep a close eye on inflation numbers in the remaining year.
On the bright side, if inflation numbers do get better in the third quarter, we could experience a dramatic shift in mortgage rates to the lower side. The key is definitely a lowering of energy costs. Crude oil has gone straight up this year and you know what they say.... what goes up must come down. We hope!
May the Mortgage Rates be with You!
Refinance Tool Box
posted by Jim Bisnett at
2:36 PM
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