Friday, March 18th 2016 - 05:49 UTC

Fed cautious on global economy uncertainties leaves rates unchanged: markets react positively

US markets rose on Wednesday, following the decision by the Federal Reserve to keep interest rates unchanged and a statement indicating the rate would only rise twice in 2016. The Dow Jones industrial average climbed 79.64 points to 17,331.17. The S&P 500 gained 11.68 points to 2,027.61, while the tech-focused Nasdaq index was up 35.30 at 4,763.97.

“Proceeding cautiously will allow us to verify that the labor market is continue to strength given the economic risk from abroad,” said Fed Chairman Janet Yellen.

The Fed noted US continues to face risks from an uncertain global economy and the FOMC judged it prudent to maintain the current policy stance at this meeting”

 “Proceeding cautiously will allow us to verify that the labor market is continue to strength given the economic risk from abroad,” said the Chairman of the Federal Reserve, Janet Yellen.

The decision led the value of the dollar to fall 0.79% against the pound and 1.04% against the euro.

Caterpillar- the maker of construction equipment- was one of the day's biggest winners, rising 2.6%. Tech companies had a strong day. Microsoft shares climbed 1.4% and Apple rose 1.3%.

Before the markets opened, new inflation figures from the Commerce Department showed that the consumer price index (CPI) fell 0.2% in February, led by a sharp fall in energy prices. But core CPI, which strips out food and energy, rose 0.3%.

The Fed indicated moderate US economic growth and “strong job gains” would allow it to tighten policy this year with fresh projections showing policymakers expected two quarter-point hikes by the year's end, half the number seen in December.

But the US central bank noted the United States continues to face risks from an uncertain global economy. Because of that uncertainty, “the committee judged it prudent to maintain the current policy stance at this meeting,” Fed Chair Janet Yellen said.

“I am wary and have not yet concluded that we have seen a significant uptick that will be lasting,” Yellen said in a press conference following the conclusion of a two-day policy meeting.

Overall, “you have seen a shift in most participants' path of policy. That largely reflects a somewhat slower projected path for global growth,” Yellen said. “The U.S. economy has been very resilient in the face of shocks ... That is important.”

Interest rates will move higher if the Fed's baseline forecast proves accurate, she added, “but proceeding cautiously will allow us to verify” that the economic recovery remains on track.

In its policy statement, the Fed noted the risks still emanating from overseas, which Yellen said included renewed signs of weakness in Japan and Europe, and the ongoing slowdown in China.

Kansas City Federal Reserve Bank President Esther George dissented in favor of raising rates at this week's meeting. Others have argued that the global situation remains too fragile to push ahead with monetary tightening.

21 comments Feed

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1 ChrisR (#) Mar 18th, 2016 - 10:41 am Report abuse
She might just as well have said “sorry, we don't know WTF to do” and left it at that.
2 Lucifer (#) Mar 18th, 2016 - 01:22 pm Report abuse
There's a storm brewing all over the world. The USA will be the only safe haven for a long while.
3 Briton (#) Mar 18th, 2016 - 07:57 pm Report abuse
US markets rose
the British market aint to bad,

the papers say that Europe is on the brink.
India is growing, and china is stable ,

perhaps the future will be brighter,
esp. after 23rd June.
who knows.
4 Skip (#) Mar 18th, 2016 - 09:01 pm Report abuse
I prefer my safe haven to Luci's safe haven. At least my government will help me out if I fall on hard times and I don't have to worry about a potential populist head of state interfering in the markets.
5 ChrisR (#) Mar 19th, 2016 - 01:52 pm Report abuse
@ 4 Skip

You give Luci too much credit after all, he's only a 'little demon'. :o)
6 Lucifer (#) Mar 19th, 2016 - 05:32 pm Report abuse
www.youtube.com/watch?v=HV_O3BA5e28

Australia? Most people I know wouldn't consider it civilization.
7 ChrisR (#) Mar 19th, 2016 - 07:13 pm Report abuse
@ 6 Little Demon

Let me explain that link for you.

They are NOT real people: it's a cartoon full of cartoon characters.

Nothing to do with Australia, it's a yank cartoon.

Glad to have been of help.
8 Lucifer (#) Mar 19th, 2016 - 11:33 pm Report abuse
www.youtube.com/watch?v=8DYje57V_BY

Its funny because its true
9 Skip (#) Mar 20th, 2016 - 03:49 am Report abuse
“Australia? Most people I know wouldn't consider it civilisation.”

That is a reflection on the calibre of people that Luci surrounds himself with.

Quite telling of her and their intelligence level.

Simple people never let facts get in the way of their reality..... Luci is just an American version of Brasileiro and Nostrils.
10 Lucifer (#) Mar 20th, 2016 - 11:44 am Report abuse
Don't forget the Simpsons.
11 Skip (#) Mar 20th, 2016 - 09:40 pm Report abuse
The Simpsons?

Oh was that the link? I didn't look. But just like Brasileiro - vacuous posts and worthless YouTube links. Who still looks at his links?

Yeah, exactly!

We can all see why you never did a Masters now, Luci. The Simpsons.... still shades of white trash even at your age Luci..... priceless.
12 Lucifer (#) Mar 21st, 2016 - 12:32 am Report abuse
Are you going to pay taxes being an illegal coffeemaker in Canada or just take a job from someone who really needs it.
13 Skip (#) Mar 21st, 2016 - 04:03 am Report abuse
Who knows?

I'm not in Canada yet. And international students can work legally so unsure why you assume I will only need to work illegally.
14 Lucifer (#) Mar 21st, 2016 - 04:56 pm Report abuse
Isn't there an age limit to what is considered a student?
15 Skip (#) Mar 21st, 2016 - 08:30 pm Report abuse
What a ridiculous concept.

As if you become to old to learn!

Is that how you see yourself at 50 Luci? Too old to learn anything? Trapped by the choices you made when young?

You're farcical Luci. What a beige, linear existence you endure.

Yes, there is an age limit. It is self-imposed on oneself when you consider you are incapable of changing and learning.
16 Lucifer (#) Mar 22nd, 2016 - 11:13 am Report abuse
Too old to learn isn't quite the same as a perpetual student who is too afraid or too dumb to ever make it into a professional job.
17 Skip (#) Mar 22nd, 2016 - 12:14 pm Report abuse
How would you know?

I've been at uni for just over 3 years. How is that “perpetual”? If I'm “perpetual” then I could only be 21 years old about now..... doesn't seem to gel with your other claims on my age.

Just because you are stupid enough to let all your personal information on the internet doesn't mean I am. You have no idea what I've done before Uni. It eats you up because your only insults are pure guess work.

You graduated from a nothing university with a nothing degree in the 80s so you could stage and sell houses. Way to go! If that is what is considered success, then congratulations. You're now old and still working. Another 15 years and you can retire with all that money you made.

As I said, what a beige, linear existence you endure.

What exciting things have you got planned for the next decade? I know, how about you stage and sell some houses. Me, I'll get my degree. And a Masters.... something you were incapable of achieving in the past 30 years. I'll travel and live and study overseas.... each year you'll squeeze a couple of weeks of holidays in with some superficial travel to places like Budapest (woopdedo went there in my early 20s).

You fell for it. You fell for this idea that earning money was the secret to success. Money is just a tool... like you. You've spent your whole adult life earning and saving and spending money.

What's at the end of your “professional job”? Retirement. Same as the guy that sweeps the streets.

You reckon you cracked the secret to happiness and success and yet you're a hamster on a wheel running your pudgy arse off because you saw all the other hamsters doing the same thing.

You're not even too old to learn.... you're too old to change.
18 Lucifer (#) Mar 22nd, 2016 - 12:39 pm Report abuse
Such great wisdom from a wishful coffeemaker.
At least in your own head.
19 Skip (#) Mar 23rd, 2016 - 09:54 am Report abuse
About the standard of comeback expected.
20 Lucifer (#) Mar 23rd, 2016 - 12:07 pm Report abuse
You must be the only person on here who gets younger each year.
No accomplishments at 21 makes it sounds reasonable except you're really closer to 30.
Too bad time doesn't reverse for you.
By US standards you've aged out of being called a “student”.
We call those people losers.
21 Skip (#) Mar 24th, 2016 - 08:28 am Report abuse
I haven't claimed an age. It is you that keeps guessing, not me that keeps claiming. Unlike you, I'm anonymous. I know how to use the Internet wisely.

So now I'm not a perpetual student? I'm now a loser? Interesting what you consider a loser.

I don't think you are a loser. Just old and boring. You just followed the path. The one time you deviated by moving to Argentina it wentarse up and you scurried back to safe and boring middle Americ.

College then work then retire. That's it.

Guess that's the path that 'winners' take and not “losers”.

You're nothing special. You just followed the same path as tens of millions of Americans without questioning or considering other options.

And now you've got to 50 and you can finally marry and...... well work until you retire I guess. Maybe travel a bit before the lifestyle choices and genetics kick in to prevent it........ YAWN!!!!!! Oh, wow, I think I nodded off there for a minute.

That winning life you lead...... riveting. So many twists and turns and deviations and surprises on that beige, linear path.

If you're winning then thank god I'm not.

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