Will FOMC Raise Interest Rates Again In February?

Jan. 13, 2005
By John S. McClenahen In the wake of the Federal Open Market Committee's (FOMC) Dec. 14 decision to raise the influential federal funds target rate by 25 basis points to 2.25%, the question is will Chairman Alan Greenspan and his eleven FOMC voting ...
ByJohn S. McClenahen In the wake of the Federal Open Market Committee's (FOMC) Dec. 14 decision to raise the influential federal funds target rate by 25 basis points to 2.25%, the question is will Chairman Alan Greenspan and his eleven FOMC voting colleagues do it again at their next scheduled meeting on Feb. 1-2, 2005? Unless U.S. economic conditions change dramatically between now and then, the FOMC is expected to raise the federal funds target another 25 basis points to 2.5%. The federal funds rate is the interest that banks charge each other on overnight loans. In announcing its Dec. 14 decision, the FOMC noted that U.S. economic "appears to be growing at a moderate pace" despite recent rises in energy prices and that "labor market conditions continue to improve gradually." Significantly, the panel also said, "Inflation and longer-term inflation expectations remain well contained." As it did on Nov. 10, when it last raised the federal funds rate, the FOMC gave itself a little wiggle room, stating "the Committee will respond to changes in economic prospects as needed to fulfill its obligation to maintain price stability."

Popular Sponsored Recommendations

Empowering the Modern Workforce: The Power of Connected Worker Technologies

March 1, 2024
Explore real-world strategies to boost worker safety, collaboration, training, and productivity in manufacturing. Emphasizing Industry 4.0, we'll discuss digitalization and automation...

Adopting an Open Ecosystem: The Way Forward for Frontline Operations

March 11, 2024
Today's manufacturing tech stack thrives on connectivity, integrating new and legacy players for a seamless operation - not on monolithic systems. Embrace the future of frontline...

3 Best Practices to Create a Product-Centric Competitive Advantage with PRO.FILE PLM

Jan. 25, 2024
Gain insight on best practices and strategies you need to accelerate engineering change management and reduce time to market. Register now for your opportunity to accelerate your...

Transformative Capabilities for XaaS Models in Manufacturing

Feb. 14, 2024
The manufacturing sector is undergoing a pivotal shift toward "servitization," or enhancing product offerings with services and embracing a subscription model. This transition...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!