Fed could adjust their rates – The Economist

Fed could adjust their rates – The Economist

The increase in revenues could give reference without notice, conditioned by the US labor market.

The US central bank left the door open to changes. File Photo: Reuters

The Federal Reserve left unchanged target its benchmark rate at 0.25 points, but cautioned that are free to make any adjustments in its monetary policy eventually, even without explanatory schedule a press conference.

After the last meeting of the Federal Open Market Committee Federal Reserve (FOMC, for its acronym in English) , explained in a statement that the conditions for economic recovery and its labor market allow them to take calmly the decision to normalize rates.

“After the current valuation, the committee believes that it can patiently take the decision to begin the normalization of monetary policy, “the statement noted.

Then, during a press conference, the Fed President Janet Yellen emphasized that its decisions on the bias of monetary policy could be made at the time that the committee finds elements of strength and consistency in the conditions of economic recovery and the labor market, which would not necessarily be explained in a press conference.

The statement reinforces what was said by Yellen: “If the information indicates a more rapid progress toward employment and aligns with inflation targets, the committee may decide to increase the federal funds rate sooner than currently anticipated.”

Inflation risk

The FOMC is the organ of the Fed conducts monetary policy in the United States. And during the last meeting of the year, reduced its forecasts for inflation, to place it between 1 and 1.6%, a range that is below the annual target of 2 percent.

At the conference, transmitted Online, the president of the Fed said inflation is moving below the target by transient events.

And the deviation of the trajectory from the target is low, he added, because “participants trust that the projection will fail in 2%, sometime. “

They maintained its growth forecast of between 2.6 and 3% by 2015, as it did last September.

Y 2016 I expected at between 2.5 and 3%, which is slightly lower than expected three months ago, the range was between 2.6 and 3 percent.

For the labor market estimate that the rate could average in 2015 at between 5.2 and 5.3%, which is below they had in September, between 5.4 and 5.6 percent.

Oil pressed

For the president of the Fed international oil price is not a concern. Recognizes that there is exposure of some oil companies, but does not see any risk on its financial performance that could jeopardize the system.

In fact, it is one of the factors downward pressure she sees as transient for inflation.

ymorales@eleconomista.mx