Gold Silver Reports — Federal Reserve officials are widely expected to announce an interest-rate increase this week amid buoyancy in the stock market and indications the U.S. economy continues to grow steadily, without signaling they anticipate accelerating their pace of policy tightening.
Beyond the expected announcement Wednesday of a quarter-point hike in the U.S. central bank’s benchmark rate target, to a range of 0.75 percent to 1 percent, investors will be looking for whether policy makers change their forecasts for the rest of 2017 and beyond.
Fed Chair Janet Yellen may offer additional clues during a press conference in Washington 30 minutes after the 2 p.m. release of a post-meeting statement and new projections. Here’s what to watch for:
The so-called “dot plot,” which displays individual rate forecasts of officials on the policy-setting Federal Open Market Committee, will probably continue to show three hikes this year as appropriate, according to the median estimate. It was last updated in December and will cover projections out to 2019, plus an estimate for the longer run.
That would imply that a flurry of signals from policy makers in recent weeks about the likelihood of tightening in March was more about a shift in the timing than in the number of increases the FOMC is likely to approve this year, according to Jonathan Wright, an economics professor at Johns Hopkins University.
“The data have been generally good over the last couple of months, but not in a way that materially changes the outlook on growth or inflation,” said Wright, a former Fed economist.
The FOMC’s statement will probably continue to acknowledge ongoing improvements in the outlook for the U.S. economy following a string of better-than-expected economic data, including the Labor Department’s latest report on the job market. That update, published March 10, showed 235,000 workers were added to payrolls in February, and the unemployment rate declined to 4.7 percent. — www.NealBhaiReports.com