Open Market Committee of the Federal Reserve System (FRS) the USA last night at the end of the two-day meeting to maintain the size of the announced base interest rate unchanged. At the same time the regulator did not give the markets a clear signal of the intention to raise rates in the coming months, indicating nevertheless a growing US economy and the growing labor market. Most experts expect the Fed rate rise once this year in September.
American Central Bank, as expected, did not raise the interest rate on federal loan funds (federal funds rate), which is in the target range of zero to 0.25 % per annum. However, the experts’ attention was riveted to this is not a predictable decision, and the possible control signals its readiness to increase the rate until the end of this year. Earlier, the Fed has promised to use a phased approach in determining the timing of the first since December 2008 rate increase, claiming that it is linked to the changing state of the economy.
In recent speeches, Fed Chairman Janet Yellen said that he considered the rate increase until the end of the year likely – in the absence of significant economic shocks. However, the resumption of the fall in oil prices, problems of China and mixed US macroeconomic indicators have generated speculation among experts that the expected tightening of the September monetary policy can not take place.
As a result, released today at 21:00 Moscow time the message of the Federal Open Market Committee (FOMC) Federal Reserve turned seasoned moderately optimistic tone. The rate is stored in order “to support continued progress toward maximum employment and price stability.” It reported that the US economy has overcome a slowdown of the first quarter, and “expanding moderately” despite the downturn in the energy sector and the problems abroad. In particular, the US central bank pointed to “substantial job growth” in recent months. This is a more positive assessment of the labor market in comparison with the meeting in June, the Fed said “some decrease” its weakness.
Thus, the Fed’s statement leaves the chances of a rate hike at the next meeting in September. At the same time the regulator did not give a clear signal about its plans, saying he wanted to see “further improvement in the labor market” and be more confident in the fact that low inflation will go to a two-percent benchmark.
Most economists surveyed by The Wall Street Journal, is considered the most probable rise in rates at the September meeting. At the same time, some experts still believe that the Fed will prefer to wait with the increase until December. At the same time CEO of Pegaso Capital Partners Carlo Galina told Bloomberg, that in a situation of weak economic growth rate rise this year, is likely to be single. “The Fed will continue to support the market”, – the expert believes. Confidential economic forecasts, mistakenly published the Fed last week, indicate that the Fed experts also expect a single rate hike this year. Their average rate forecast for the end of the year – only 0.35% per annum.
Possible Fed rate hike in September is likely to be reflected in the actions of the Russian Central Bank. Experts of “Renaissance Capital” believe that was launched in January this year cycle of easing monetary policy in Russia in September, will be “paused”. According to them, the Bank of Russia will not be accompanied by a decrease in the Fed’s tightening its key rate.
Following the publication of the results of the meeting of the dollar began to rise against foreign currencies. However, since, contrary to the expectations of analysts, in a statement there was no hint of a possible rise in periods, growth was rapid. Russian ruble to the dollar on the news from the Fed has not changed. In anticipation of the situation with the rate of application yesterday in the Russian Economy Ministry commented: “The fall of commodity markets and currencies of developing countries was a consequence of speculation about imminent rate hikes in the United States. Now, these expectations have largely priced in. We expect that the pressure on the raw material and developing countries should several loose “.
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