Fed Chair Janet Yellen signaled two possible interest rate moves for the year following this month's rate hike, but now Fed governors are estimating three move moves at a faster pace than originally projected.
Boston Fed President Eric Rosengren said implementing quicker rate hikes would do two things — one, keep investors from taking excessive risks in commercial real estate, and two, properly reflect the strength of the U.S. economy, the Wall Street Journal reports. San Francisco Fed President John Williams said that while he still expects only two more hikes this year, he would not rule out the possibility of a third.
But not everyone is clamoring for three more moves this year. One of Yellen’s closest allies, Fed Vice Chairman Stanley Fischer, recently said he forecasts only two more hikes for 2017.
The increase in rates to a range of 0.75% to 1% in March was of little surprise to investors, and commercial real estate economists had overwhelmingly predicted it based on the economy’s continued recovery and February’s strong jobs report. It was the second quarter-point increase in benchmark rates implemented since December's move — prior to that the Fed had not moved rates since December 2015.
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