FOMC To Communicate More… And Leaves Mid-2013 Low Rate Date Open To Change

January 3, 2012 by Jon C. Ogg

The FOMC Minutes usually just tell you what you already knew, but this time is a bit different from the December meeting.  New easing methods will be communicated.  The FOMC will start making member projections inside the economic projections and will release projections for the Fed Funds Rate.  More importantly, the new communications will describe the key factors underlying each projection.  The FOMC noted that conditions could warrant additional economic accommodation as the FOMC participants see a moderate rate of economic growth.  Another issue is that unemployment is seen declining gradually and that the markets are unsettled until the Euro Zone issued are addressed.  The FOMC further noted that the global strains do pose significant risks even though the balance sheets of most U.S. banks have improved. 

Several members did note that the Mid-2013 rate stance for low rates may need adjustment. As noted “For now, however, the Committee agreed to reiterate its anticipation that economic conditions–including low rates of resource utilization and a subdued outlook for inflation over the medium run–are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013.  A number of members indicated that current and prospective economic conditions could well warrant additional policy accommodation, but they believed that any additional actions would be more effective if accompanied by enhanced communication about the Committee’s longer-run economic goals and policy framework.”

THE FULL MINUTES ARE HERE

JON C. OGG

Sponsored: Attention Savvy Investors: Speak to 3 Financial Experts – FREE

Ever wanted an extra set of eyes on an investment you’re considering? Now you can speak with up to 3 financial experts in your area for FREE. By simply
clicking here
you can begin to match with financial professionals who can help guide you through the financial decisions you’re making. And the best part? The first conversation with them is free.


Click here
to match with up to 3 financial pros who would be excited to help you make financial decisions.