![]() "Survey-based measures of longer-term inflation expectations are little changed, on balance." "Market-based measures of inflation compensation remain low," the Fed said in a nod to slow wage growth. In sum, that means the Fed now believes it won't reach its 2 percent target until 2019. The long-run outlook for GDP remained at 1.8 percent.Īt the same time, the Fed reduced its outlook for inflation, cutting its expectation from 1.7 percent this year to 1.5 percent, and from 2 percent to 1.9 percent in 2018. ![]() The committee's expectations back in June were for a 2.1 percent GDP gain this year, but that was pushed to 2.2 percent in the latest projections. In their quarterly economic projections, Federal Open Market Committee members now forecast economic growth to run a bit stronger than before. While market participants widely expected the lack of an interest rate hike and the balance sheet roll-off, the details of where the Fed stood were considered a wild card. Stock market prices soared during the three QE stages, though economic growth otherwise was comparatively lackluster and coincided with the slowest recovery since the Great Depression. The intent of the program at first was to keep mortgage rates low, but grew to a general attempt to lower short-term rates and provide liquidity to the economy. The balance sheet grew as the Fed began QE in late 2008, during the worst of the financial crisis and the Great Recession. ![]() The moves to hold the line on interest rates and reduce the balance sheet gained unanimous committee approval. Instead of reinvesting all the proceeds of its massive bond portfolio, the Fed will allow $10 billion to roll off at first, increasing quarterly in $10 billion increments until the total hits $50 billion starting in October 2018. The Fed for the first time did provide a formal timetable for how the operation will take place. Personal Loans for 670 Credit Score or Lower Personal Loans for 580 Credit Score or Lower Best Debt Consolidation Loans for Bad Credit
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