Jueves, 23 Marcha, 2017

Fed on track to raise U.S. rates twice more this year: Evans

US dollar firm on Fed outlook The Week Ahead: Will the Fed Follow Up on Rate Increases?
Manuel Armenta | 21 Marcha, 2017, 02:10

Policy makers also view worldwide risks as less threatening than a year ago, and solid progress at home without major headwinds from overseas have improved their confidence in the outlook.

St. Louis Fed President James Bullard has previously said he only forecasts one increase this year. The unemployment rate was little changed at 4.7 percent. "But we aren't sure if we have yet reached it".

The Federal Reserve is on track to raise interest rates twice more this year after a policy tightening last week, and it could be more or less aggressive depending on inflation and fiscal policies from the Trump administration, a Fed rate-setter said on Monday. Real estate recorded a slight gain after the Fed's announcement on March 15, 2017, and one possible reason could be the dovish tone that Fed Chair Janet Yellen took toward future rate hikes in 2017.

Market watchers also pay close attention to the Fed's dot plot projections that show where each of the sixteen voting members think the Fed's policy rate will be headed in the coming years.

These adjustable rates, he says, could rise as much as ¾ percent, which would increase the same metric as mentioned above (the monthly payment on a $200,000 mortgage) by as much as $84. Home equity lines of credit are pegged to the prime rate so it's a direct path through any time the Fed hikes rates by a quarter point your home equity line of credit's going to go up by a quarter point, said McBride.

He said that "markets still don't seem to be understanding that our entire global economic and financial - if not political - game is predicated on the United States running a large trade deficit".

Philadelphia Fed President Patrick Harker, who also votes on monetary policy this year, separately said that he can't rule out more than three rate increases this year, and that there probably will be some overshoot on the Fed's 2 percent inflation goal.

It's just another way Kashkari is at odds with Yellen.

Kashkari, who unsuccessfully ran as a Republican for governor of California in 2014, was the administrator of the Treasury Department's Troubled Asset Relief Program during the 2008 financial crisis.

As head of the Minneapolis Fed, Kashkari launched an initiative to craft a solution to the problem of too-big-to-fail banks.

Countries with external imbalances or heavy reliance on external funding are likely to be most vulnerable to the effects of higher US interest rates.

The plan, released in November, proposed to prevent future bailouts by forcing the biggest USA banks to hold much more capital.

"We will have fewer mega banks, and there will be far less concentration in the banking system", Kashkari said.

The plan would require congressional legislation.