The Federal Reserve raised interest rates by half a percentage point Wednesday and signaled plans to keep raising them more in 2023, capping off one of the most aggressive years in the central bank’s history, The Washington Post reported.
The widely expected quarter-percentage-point lowering of borrowing costs, however, is unlikely to assuage U.S. President Donald Trump’s increasingly strident demands for the central bank to ease monetary policy.
Even as the U.S. central bank left its benchmark interest rate unchanged for now, the shift in sentiment since its last policy meeting was marked.
Banks suffered their usual worries about low borrowing rates to drag the pan-European STOXX 600 down 0.2 percent, though London’s FTSE edged up as its miners were lifted by higher copper and metals prices.
The more intense focus among investors may be on the balance sheet, and the Fed’s plans to stop reducing its holdings of Treasury bonds and mortgage-backed securities each month by as much as $50 billion.
Rates are currently “appropriate,” Powell said in a wide-ranging interview with CBS’s 60 Minutes news show.
A raft of Fed policymakers speaking since the Fed’s January pledge of patience have insisted the economy is in a good place.
And as 2018 closes out with a dramatic slump in stocks and a drop in bond yields, financial markets will need to brace for next year, when Powell is scheduled to make more unscripted public remarks than any Fed chief in history.
On Monday, Trump said “The only problem our economy has is the Fed.”
Donald Trump said the partial shutdown of the federal government was going to last until his demand for funds to build a U.S.-Mexico border wall is met.
The Federal Reserve is finished raising U.S. interest rates.
The dollar fell 0.39 percent to 110.00 yen, its lowest level since late August and is set to fall for an eighth straight session against the Japanese currency, with London and New York shut for Christmas.
U.S. President Donald Trump has discussed firing Federal Reserve Chairman Jerome Powell, Bloomberg reported on Saturday, citing sources.
After weeks of market volatility and calls by President Donald Trump for the Federal Reserve to stop raising interest rates, the U.S. central bank instead did it again, and stuck by a plan to keep withdrawing support from an economy it views as strong.
However, some analysts still see the Fed raising rates 2-3 times in 2019.
The central bank is due to announce its decision at 2 p.m. EST (1900 GMT) after its final two-day policy meeting of the year. Fed Chairman Jerome Powell is scheduled to hold a press conference half an hour later.
“I think that would be foolish, but what can I say?” Trump told Reuters in an interview.
U.S. interest rates may be nearing a peak, but relative interest rate differentials still offered some support for the dollar index, which rose 0.02 percent to 97.41 .DXY
The Federal Reserve’s plans to continue raising interest rates next year were met with more skepticism on Wall Street on Monday
Federal Reserve policymakers are largely united on the need to raise borrowing costs further, minutes from their most recent policy meeting show.