Fed likely to leave interest rates unchanged in March

Global uncertainty won’t impact rate hikes if US fundamentals remain strong: report

New York /
Mar.March 15, 2016 02:15 PM

The Federal Reserve is expected to leave its benchmark interest rate unchanged this week, though the central bank will likely note that global economic uncertainty won’t impact its approach to rate hikes as long as U.S. fundamentals remain strong.

In its forecast this week, the Fed is expected to note that continually strong job creation and inflation numbers won’t influence its outlook on interest rates, which are expected to tick upward over the course of this year.

That would be a change of tone from chair Janet Yellen’s comments last month, according to Reuters, when Yellen signaled that economic uncertainty in China and Europe had “exacerbated concerns about the outlook for global growth” and influenced the central bank’s outlook on rate hikes.

The Fed raised rates for the first time in nearly a decade in December amid signs of sustained economic growth and appeared ready to move the benchmark upward up to four more times in 2016.

This week’s forecasts indicate a retreat from that pace, with perhaps only two or three further rate hikes slated for this year, according to economists and Fed officials. [Reuters]Rey Mashayekhi


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