A small cut to an interest rate little known beyond Wall Street could lead to a ...
- A small cut to an interest rate little known beyond Wall Street could lead to a big payoff for the Federal Reserve’s most important asset: its credibility.
Instead it made what Chair Jerome Powell insisted was nothing more than a minor technical adjustment to “interest on excess reserves,” or IOER, that could nudge borrowing rates lower by a few hundredths of a percentage point. The U.S. central bank on Wednesday left its target policy rate unchanged at 2.25-2.50% and said that the global economy warrants patience on making any further changes on rates.
The fed funds rate rose to 2.45% on Tuesday and has remained there since, although after the Fed’s announcement the rate markets expect in three months fell to 2.386% in late Wednesday trading, the lowest level since December. Analysts agreed, saying the tweak is also very unlikely to make any difference in the economy, or in important rates like those on mortgages, government bonds or what people earn on savings they keep at the bank.
These days it sets rates by changing what it pays banks to keep money in reserve at the Fed rather than by manipulating the amount of reserves.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Fed and tech stocks could crack the market rally, warns Wall Street strategistOur call of the day, from Miller Tabak Asset Management’s strategist, Matt Maley, warns that any shift in the Fed’s dovish stance this week could cause this...
Read more »
Wall Street adds a bit to gains after Fed statement citing ongoing economic growthU.S. stocks added slightly to gains after the Federal Reserve held interest rate...
Read more »
Wall St. slips as energy drops, investors digest Fed commentsU.S. stocks eased further from recent record highs on Thursday as energy shares ...
Read more »
Wall St. gains as soft inflation data supports accommodative FedU.S. stocks edged higher on Monday, with the S&P 500 and the Nasdaq hitting reco...
Read more »
White House economic advisor Larry Kudlow says Fed should still cut rates despite 3.2% GDP growthThe U.S. economy is off to its best start to a year since 2015 and White House economic adviser Larry Kudlow believes it means the Federal Reserve should cut interest rates.
Read more »
Hot first-quarter economic growth number challenges Fed as it meets next weekHotter-than-expected first quarter growth is likely to revive the debate within the Fed about the direction of policy.
Read more »
Slowing inflation may lead Fed to cut interest rates: KudlowSlowing inflation may lead the Federal Reserve to cut interest rates, White Hous...
Read more »
The Fed is looking at a new program that could be another version of 'quantitative easing'Federal Reserve officials are considering a new program that would allow banks to exchange Treasurys for reserves.
Read more »
Strong U.S. growth, weak inflation leave Fed stuck happily on holdThe Federal Reserve is expected to hold interest rates steady at its policy meet...
Read more »
White House is 'reviewing' Trump Fed pick Stephen Moore's controversial past writingsWhite House press secretary Sarah Sanders confirmed Monday that the administration is currently reviewing the past writings of conservative economics pundit Stephen Moore, Trump's pick to join the Federal Reserve Board. Moore's writings have been criticized for denigrating women.
Read more »