US President Donald Trump speaks in a meet outside White House
22 September, 2017, 09:04
Analysts widely believed that inflation developments will determine the timing of next rate hike.
The more immediate and headline-grabbing news out of Wednesday's rate announcement, of course, was the Fed's key rate itself: The Fed held its target for the federal funds rate at 1 per cent to 1.25 per cent, where it has sat since June, following three quarter-percentage-point rate hikes in the prior six months.
Yellen said in June that the plan would lead to "a gradual and largely predictable decline" in the assets.
Yellen can expect to be asked, again, about whether she's discussed her future with President Donald Trump, after it emerged that she had breakfast with his daughter Ivanka in July.
"It might be a heavy lift to raise rates three times at the same time they are shrinking the balance sheet", said Scott Anderson, chief economist at Bank of the West in San Francisco, who sees the median FOMC forecast slipping to two quarter-point increases in 2018.
Given the Fed's statement at its June 2017 policy meeting, the balance sheet reduction should begin gradually at USD 10 billion per month, i.e.by no longer reinvesting each month a volume of USD 6 billion of maturing Treasuries and USD 4 billion of maturing agency bonds, such as mortgage-backed securities. The jobless rate is just 4.4 percent, near a 16-year low. Investors typically sell shares of utilities when interest rates rise, partly because they lose their appeal as bond proxies since investors can expect similar returns investing in bonds.
The Fed expanded its balance sheet to unheard-of levels during the 2008-2009 financial crisis and its lingering economic aftermath, first to stave off financial and economic collapse, and then to keep the USA economy on what was effectively a monetary respirator until it could return to normal strength. Presidential economic adviser Gary Cohn, a prior favorite for Fed chair, appears to be on the outs with the president after criticizing the administration's response to violence from white supremacists in August in Charlottesville, Virginia.
The Fed will scale back its holdings by $10 billion in October and raise that amount gradually in the months to come.
On the other hand, the Fed remained unshaken in its confidence that the economy's underlying strong trend remains intact, and that the sluggish inflation is temporary.
Federal Reserve Chair Janet Yellen says the "severe disruptions" from Hurricanes Harvey, Irma and Maria will briefly hold down economic growth.
South African bonds were marginally weaker at midday on Tuesday as the market remained focused on the Reserve Bank's interest rate decision on Thursday, and the release of consumer inflation data on Wednesday.
One of the more notable takeaways for me was in Yellen's press conference where she admitted she hadn't met with Trump and used the phrase "future policymakers" in answering a question. The balance-sheet expansion was result of the Fed's so-called quantitative-easing programs - buying up financial assets to keep money flowing through the economy.
To cut the long story short, the Fed just wants to undo everything that has not worked: unconventional policies. The Fed, though, has yet to achieve its other objective of stabilizing prices at a 2 percent annual rate.
That prompted a sector rotation out of stocks like utilities - with the S&P utilities index down 0.8 percent - and into banks.
The seven-member Fed board will soon have four openings, after the announcement this month by Stanley Fischer that he is stepping down as vice chairman.
The dollar index, which tracks the greenback against a basket of six major rivals, inched 0.2 percent lower to 91.928. China's Shanghai Composite Index dipped by 0.2 percent, while Hong Kong's Hang Seng Index fell by 0.4 percent.
Griffin and boyfriend Randy Bick called the police to file a noise complaint against Mezger's grandkids, according to reports. - The board warned if there are any similar incidents in the future, Mezger, who is also chairman, will be dismissed.
Project Cars 2 is out tomorrow, and it's a motorsport simulation game from the car-obsessed folks at Slightly Mad Studios. Project Cars 2 is going to be released on September 22nd in the Americas on the PlayStation 4, Xbox One, and PC via Steam.
Asked by Faris about his contentious interactions with the press during his tenure, Spicer said he made some mistakes. "I find this hard to believe", Colbert said, referencing former press secretary Sean Spicer's surprise appearance .
Flair never drank on the job, but throwing more than a few back after work was his way of getting to know his fellow wrestlers. According to family members, Flair was only given a 20 percent chance of survival when he was first admitted.
At the time, a BYU spokeswoman stated that the rest of the school "has simply chosen not to sell caffeinated beverages on campus". Caffeinated sodas will still not be sold at the two satellite campuses in Jerusalem and Salt Lake City.
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Apple Shares Tumble on Weak iPhone 8 Preorder Reports
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