Tag Archives: Federal Funds Target Rate

The Federal Open Market Committee (FOMC) once again stood still on raising the federal funds rate this month due to disappointing economic indicators, leaving the looming question of when the Fed will make its move.

The Fed fueled further speculation about another rate hike in June, which would be the first time the Fed has raised the federal funds target rate since the historic liftoff in December.

While speculation of a June rate hike by the Fed persists, St. Louis Fed President James Bullard discussed two possibilities for the Fed to take on the normalization of monetary policy.

The Federal Reserve made the long-awaited, much-anticipated announcement on Wednesday afternoon that federal funds target rate will increase by a quarter of a percentage point from its near-zero level where it has been since 2006.

In light of the recent, lower-than-expected jobs report for September, the Federal Reserve may hold off on raising interest rates until stronger labor market data comes forth.

"In determining how long to maintain this target range, the Committee will assess progress—both realized and expected—toward its objectives of maximum employment and 2 percent inflation," the Fed said in a statement.

The Federal Open Market Committee stated in its July meeting that more labor growth is needed before the Fed decides to raise the federal target funds rate. Will July's job gains drive the Fed to increase rates in September after years of keeping them near zero?