The U.S. Federal Open Market Committee (FOMC) announced its latest interest rate resolution on Wednesday (17), only the current economic outlook improves, Inflation is expected to increase, the Federal Reserve Committee still maintains near-zero interest rates, maintaining the bond purchase program, and is not expected to raise interest rates until 2023.
As the United States has offered several stimulus bills, and there are more than 100 million American people vaccinated with at least one dose of the new crown (Chinese communist virus), the U.S. economy is recovering faster than a quarter before the forecast.
Fed wrote in a post-meeting statement that after a slowdown in the pace of economic recovery, economic activity and employment indicators have picked up recently, although the industries most severely affected by the new crown Epidemic remain weak and inflation continues to be below 2%.
The FOMC’s quarterly economic forecast calls for U.S. GDP growth of 6.5% in 2021, with cooling in subsequent years, and the unemployment rate expected to fall to 4.5% from the current 6.2%.
According to the latest release of the interest rate dot plot, seven of the 18 FOMC members believe that the Fed will raise rates at least once in 2023. Last December, only five officials predicted a rate hike by the end of 2023.
After the news was released, the cut-off Time before 2:20 a.m. Taipei time on Thursday, Dow Jones rose more than 100 points, the S&P 500 index was flat, that the index fell narrowed to about 0.4%.
The 2-year U.S. bond yield expanded from 0.147% to 0.137%. Ten-year U.S. bond yield converged on gains from 1.660% to 1.650%.
The dollar fell slightly by 0.11%, temporarily at $91.70. Gold surged briefly from $1,734 per ounce to $1,742 per ounce for now.
Michael Arone, chief investment strategist at State Street Global Advisors, said this sounds like the perfect scenario for investors and the economic outlook, and Wall Street is seeing a very optimistic market reaction to it.
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