Federal Reserve want to be patient about raising short term interest rate as they fear it might heart the economyChris Middlebrooks (Author) Published Date : Feb 19, 2015 03:47 IST
Federal Reserve policymakers want to be patient about raising the short term interest rate as they fear that increased rate may heart the US economy recovery.
They have published the meeting minutes from the January 27-28 policy meeting on Wednesday. In the documents it shows that, Fed officials are concern as how they will keep the U.S. economic growth steady as there are several world market are plummeting. They are also worried about the falling inflation expectation in the United States. The document showed that, the Feds had debated about the impact of the low inflation on their decision of rate hike.
But Fed officials didn t confirm when they are going to raise the interest rate. It was reported earlier that, in January Fed officials wanted to have the option to raise the interest rate in the middle of 2015 if US economy perform well.
The meeting minute stated that, It was suggested that the [Fed] should communicate clearly that policy decisions will be data-dependent, and that unanticipated economic developments could therefore warrant a path of the federal funds rate different from that currently expected by investors or policy makers .
Market expert are saying that, the economy is growing strongly and steadily after the meeting of the Fed officials on January. Which is the strongest recovery since the recession of 2009. The growth was reinforced by governments job sector data released last month. Through the January Feds officials were discussing a number of feature of raising the Fed s benchmark interest rate, which they have held near zero since December 2008.
In meeting minutes also suggested that, some of the Fed policymakers are worried that, Federal Reserve will wait too long to raise the rate. But it was suggested that, Fed Chairwomen Janet L. Yellen and most of the members of the committee want to observe continues recovery of the economy as well as they are concerned that, premature raising of the rate will heart the solid economic recovery.
Federal Reserve want to be patient about raising short term interest rate as they fear it might heart the economy