29 June, 2017
The Fed looks a lot of data - much more than just the unemployment rate and the inflation rate. They continued to predict 2 percent inflation next year. Mortgage rates will be higher, as will credit card interest rates and auto loans. It was down a point to 2,439.
Shortly after the opening bell, the Dow Jones Industrial Average fell 87.86 points, or 0.41 percent, to 21,286.70.
"We continue to expect that the economy will expand at a moderate pace", Federal Reserve Chair Janet Yellen said at a news conference following the hike.
June 14 (Reuters) - U.S. stocks were little changed on Wednesday after the Federal Reserve made a widely expected move to raise interest rates for the second time in three months. But the Fed also laid out a plan to reduce the overall size of its balance sheet. Annual inflation is running at 1.7 percent.
They lowered projections for 2017 to 1.6% from their March estimate of 1.9%. There it stood for 7 meager years while the economy recovered slowly.
"We think the fall in actual real rates is explained by the slowdown in potential GDP growth driven by demographics and weaker productivity growth, and by an elongated credit and monetary policy cycle". One more rate hike is expected before the end of 2017.
The pair of disappointing economic reports come ahead of the latest Federal Reserve policy decision.
The number of dissenting votes was taken as a sign by investors that the United Kingdom central bank is closer to ending the stimulus put in place after last year's Brexit referendum.
One member of the Fed's committee objected to the rate rise.
The clear outline has been given by Fed on its decision to cut down its $4.2 trillion portfolio of Treasury bonds and mortgage-backed securities. "They are expecting 2 percent, which may not be realistic". The rise represents the third hike in six months and pushes the key rate to levels not seen since 2008. The unemployment rate, at 4.3%, is at its lowest level since 2001.
USA government bonds pulled back Thursday, lifting the yield on the 10-year Treasury note from its lowest level of the year, amid continued fallout from Wednesday's Federal Reserve meeting. However, the Nasdaq Composite Index dropped 0.8 percent. In Asia, Japan's Nikkei 225 ended the day marginally lower. It is roughly flat against the pound, at $1.2758.
