And on forward guidance: "The Committee now anticipates, based on its assessment of these factors, that it likely will be appropriate to maintain the current target range for the federal funds rate well past the time that the unemployment rate declines below 6-1/2 percent, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal."
Rates will be low for a long long time ...
As far as the "Appropriate timing of policy firming", the participants moved out a little with three participants now seeing the first increase in 2016.
Bernanke press conference here or watch below.
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On the projections, GDP was mostly unrevised, the unemployment rate was revised down slightly, and inflation was revised down.
GDP projections of Federal Reserve Governors and Reserve Bank presidents | ||||
---|---|---|---|---|
Change in Real GDP1 | 2013 | 2014 | 2015 | 2016 |
Dec 2013 Meeting Projections | 2.2 to 2.3 | 2.8 to 3.2 | 3.0 to 3.4 | 2.5 to 3.2 |
Sept 2013 Meeting Projections | 2.0 to 2.3 | 2.9 to 3.1 | 3.0 to 3.5 | 2.5 to 3.3 |
June 2013 Meeting Projections | 2.3 to 2.6 | 3.0 to 3.5 | 2.9 to 3.6 |
The unemployment rate was at 7.0% in November.
Unemployment projections of Federal Reserve Governors and Reserve Bank presidents | ||||
---|---|---|---|---|
Unemployment Rate2 | 2013 | 2014 | 2015 | 2016 |
Dec 2013 Meeting Projections | 7.0 to 7.1 | 6.3 to 6.6 | 5.8 to 6.1 | 5.3 to 5.8 |
Sept 2013 Meeting Projections | 7.1 to 7.3 | 6.4 to 6.8 | 5.9 to 6.2 | 5.4 to 5.9 |
June 2013 Meeting Projections | 7.2 to 7.3 | 6.5 to 6.8 | 5.8 to 6.2 |
The FOMC believes inflation will stay significantly below target.
Inflation projections of Federal Reserve Governors and Reserve Bank presidents | ||||
---|---|---|---|---|
PCE Inflation1 | 2013 | 2014 | 2015 | 2016 |
Dec 2013 Meeting Projections | 0.9 to 1.0 | 1.4 to 1.6 | 1.5 to 2.0 | 1.7 to 2.0 |
Sept 2013 Meeting Projections | 1.1 to 1.2 | 1.3 to 1.8 | 1.6 to 2.0 | 1.7 to 2.0 |
June 2013 Meeting Projections | 0.8 to 1.2 | 1.4 to 2.0 | 1.6 to 2.0 |
Here is core inflation:
Core Inflation projections of Federal Reserve Governors and Reserve Bank presidents | ||||
---|---|---|---|---|
Core Inflation1 | 2013 | 2014 | 2015 | 2016 |
Dec 2013 Meeting Projections | 1.1 to 1.2 | 1.4 to 1.6 | 1.6 to 2.0 | 1.8 to 2.0 |
Sept 2013 Meeting Projections | 1.2 to 1.3 | 1.5 to 1.7 | 1.7 to 2.0 | 1.9 to 2.0 |
June 2013 Meeting Projections | 1.2 to 1.3 | 1.5 to 1.8 | 1.7 to 2.0 |
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