Fed On Track for Midyear Interest Rate Hike
The Fed signaled today that it was on course to raise its key interest rate this June by citing "strong" labor market growth and "solid" economic standing in one of its cheeriest assessments in years. An energy sector bedeviled by plunging oil prices dented some of the optimism, but even that should be offset by other resurgent indicators. "as the labor market improves further and the transitory effect of lower energy prices and other factors dissipate.”
Chairwoman Janet Yellen has said that the Fed would put off a rate decision for another two meeting, so the earliest that a change could come is June. The "patient" approach to the decision reflects concerns about anemic inflation and, to a lesser extent, stagnant wage growth. The oil price collapse and ominous news from economies overseas have less to do with the Fed's tentative approach to the rate hike.
