Fed Rate Hike: US Stocks Go Up, Stocks Come Down

Fed Rate Hike: US Stocks Go Up, Stocks Come Down”

This has raised questions about the bank's future course. So far, Trump has sent conflicting signals about whether he plans to nominate her for a second term. There was only one rate increase in both 2015 and 2016.

The majority of Fed officials estimated in March that they would raise rates two more times this year.

The Fed's preferred measure of underlying inflation has retreated to 1.5 percent, from 1.8 percent earlier this year, and has run below the central bank's 2 percent target for more than five years. Facebook rose 1.5 percent to $150.68 while Microsoft gained 1.2 percent to $70.65.

Yellen, the first woman to lead the Fed, is serving a term that will end in February.

There isn't much suspense about what the Fed will announce when its latest policy meeting ends Wednesday: That it's raising its key short-term interest rate for the third time in six months. The Fed said Wednesday that it would eventually allow a small amount of bonds to mature without being replaced - an amount that would gradually rise as markets adjusted to the process. He billed his plan as a way to accelerate economic growth from the sluggish 2.1 percent annual rate of the past eight years. Investors want to know, for example, how fast the pace of rate increases may be in coming months or whether Washington's political paralysis has concerned the Fed. Unemployment dipped to 4.3 percent in May, a 16-year low.

The Fed would start with monthly reductions in Treasury holdings of no more than $6 billion and $4 billion in mortgage bonds. Inflation was expected to be at 1.7 percent by the end of this year, down from the 1.9 percent previously forecast.

Economic-growth projections were little changed, with the median forecast for 2017 moving to 2.2% from 2.1%. US data showed an unexpectedly large weekly build in USA gasoline inventories and International Energy Agency (IEA) data projected a big increase in non-OPEC output in 2018.

Germany's DAX index is up 0.4 percent and Britain's FTSE 100 0.1 percent.

This assessment will take into account a wide range of information, including measures of labour market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and worldwide developments. In Asia, Japan's Nikkei 225 ended the day marginally lower.

USA gold futures for August delivery were almost flat at US$1,268.90 an ounce.

The Federal Reserve will be completing its two-day meeting today during which it is expected to announce a 25 bps interest rate rise for its benchmark rate to reach a target range of 1 to 1.25%.

The dollar has been trading lower today following weak U.S. economic data, with the Bloomberg Dollar index dropping to lows last seen in October 2016, but has started rising on the news.

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