Handelsbanken: Første renteforhøjelse til marts

In the Policy Statement after the meeting on December 16-17, the Federal Open Market Committee (FOMC) gave a strong signal that a first rate hike will come next year. To increase flexibility, the FOMC changed its forward guidance. “Based on its current assessment, the Committee judges that it can be patient in beginning to normalise the stance of monetary policy”. However, this new guidance is no change in policy intentions, according to the Statement. It is consistent with the previous guidance that it will likely be appropriate to maintain the current low target range for the federal funds rate for a considerable time following the end of its asset purchase programme in October. At the press conference, Fed Chair Janet Yellen said that she does not foresee a first rate hike for “at least the next couple of meetings”, which would point to the April meeting at the earliest. However, Yellen added immediately that policy is determined by incoming data and that there is “no pre-set time” as to when the central bank will start normalisation and that “no meeting is off the table”. This is in line with the following reiterated formulation in the Statement: “if incoming information indicates faster progress toward the Committee’s employment and inflation objectives than the Committee now expects, then increases in the target range for the federal funds rate are likely to occur sooner than currently anticipated”. Three Fed Presidents voted against the decision. Minneapolis Fed President Narayana Kocherlakota and Dallas Fed President Richard Fisher dissented on the dovish side, while Philadelphia Fed President Charles Plosser dissented on the hawkish side.