FOMC Increases Funds Rate As Expected
by:Tom Moeller
|in:Economy in Brief
Summary
- Federal funds rate range raised to 5.25% - 5.50%.
- Rate is highest since March 2001.
- Fed’s focus remains on reducing inflation.
At today’s meeting of the Federal Open Market Committee, the target for the federal funds rate was raised to 5.25% - 5.50%. The increase from 5.00% - 5.25% followed no action at the last FOMC meeting. The rate has been lifted from near zero in March 2022. Each member of the FOMC voted in favor of today’s action.
In a statement accompanying today’s meeting, the Fed indicated “Recent indicators suggest that economic activity has been expanding at a moderate pace. Job gains have been robust in recent months, and the unemployment rate has remained low. Inflation remains elevated. The Committee is strongly committed to returning inflation to its 2 percent objective.”
In addition, “Tighter credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation. The extent of these effects remains uncertain.”
The statement also indicated that “the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities, as described in its previously announced plans.”
The press release for today’s FOMC meeting can be found here.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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