在线国产一区二区_成人黄色片在线观看_国产成人免费_日韩精品免费在线视频_亚洲精品美女久久_欧美一级免费在线观看

  Home>News Center>World
         
 

Fed raises rates, pledges gradual course
(Agencies)
Updated: 2004-07-01 08:46

The Federal Reserve raised U.S. interest rates for the first time in four years on Wednesday, boosting them a quarter percentage point in what likely is the first of several rises to keep inflation at bay.


The Federal Reserve raised U.S. interest rates for the first time in four years on June 30, 2004, boosting them a quarter percentage point in the first of a likely series of increases to keep inflation at bay. The decision by the U.S. central bank's policy-setting Federal Open Market Committee moves the benchmark federal funds rate -- which affects credit costs throughout the economy -- to 1.25 percent. Federal Reserve chairman Alan Greenspan seen during testimony on Capitol Hill in this April 21, 2004 file photo. [Reuters]
The unanimous decision by the U.S. central bank's policy-setting Federal Open Market Committee moves the benchmark federal funds rate -- which affects credit costs throughout the economy -- to 1.25 percent.

The widely expected move formally ends a 13-step easing cycle that began in 2001 and took the key overnight rate to a 1958 low of 1 percent.

With a pick-up in economic momentum that has created 1.2 million jobs this year and ushered in higher prices, the Fed has embarked on an effort to take away some of the stimulus of cheap credit in gradual stages this year and next.

In a statement issued after its two-day meeting, the central bank repeated a pledge to follow a "measured" pace, which markets have taken to imply a course of smaller, quarter-point rate increases rather than larger ones.

"With underlying inflation still expected to be relatively low, the committee believes that policy accommodation can be removed at a pace that is likely to be measured," the Fed said.

"Nonetheless, the committee will respond to changes in economic prospects as needed to fulfill its obligation to maintain price stability," it added in new wording that left it room to move more aggressively if needed.

The Fed also increased the largely symbolic discount rate a quarter point to 2.25 percent.

SIGHS OF RELIEF

Analysts said policy-makers had struck the right note -- balancing reassurance that no flare-up in inflation was near with a warning they were on guard lest one emerge.

"This is a predictable, user-friendly kind of statement that tells the market that nothing will happen soon to accelerate the pace of the tightening process," said economist Dana Johnson of Banc One Capital Markets.

Higher rates may weigh on debt-heavy consumers but should prove a plus for savers and those living on fixed incomes.

Several U.S. banks raised their prime lending rates -- those offered to their top customers -- a quarter point to 4.25 percent as the Fed action rippled through commercial markets.

The Bush administration played down any worry that costlier credit could cloud the rosy economic outlook it wants to highlight going into November's presidential election.

"That's not something at this point that is a concern," said White House spokesman Scott McClellan. "It's just a reflection that the economy is growing stronger and that people are finding work."

Former President George H.W. Bush blamed his 1992 election loss partly on Fed Chairman Alan Greenspan, for failing to cut interest rates quickly enough to spur growth.

Relations seem friendly between Greenspan and the current President Bush, who has maintained a resolutely hands-off approach to the central bank.

Treasury Secretary John Snow said Wednesday the administration respects Fed independence and shares its goals of growth with low inflation.

Fed officials' assurances that they do not expect a repetition of the kind of aggressive tightening seen in 1994 helped financial markets prepare by "pricing in" expected rises and to face Wednesday's rate rise with equanimity.

Prices for bellwether 10-year Treasury notes rose 27/32 of a point and the yield dipped to 4.58 percent.

Stocks strengthened modestly, with the Dow Jones industrial average up 22.05 points to 10,435.48. The high tech-heavy Nasdaq composite index rose 12.86 to 2,047.79.

ONLY A FIRST STEP

A Reuters poll of top Wall Street firms after the Fed announcement found 21 of 22 expect another quarter-point hike at the next scheduled policy meeting on August 10.

The median forecast among participants for the fed funds rate by the end of the year was 2 percent, rising to 3.75 percent by the end of 2005.

Soaring energy costs have pumped up prices for high-profile goods like gasoline, but broader government gauges like the Consumer Price Index also have been on the rise.

In its statement, the central bank said while inflation data were "somewhat elevated," part of this increase seems due to transitory factors.

Economist Richard Yamarone of Argus Research Corp. in New York said Wednesday's rate rise was from an exceptionally low level, and that it, and those to follow, "should not be interpreted as an attempt to brake an out-of-control economy.

"These series of rate hikes are more appropriately analogous to taking the foot off the accelerator," he added.

One thing inflation-wary policy-makers will need to watch is productivity, or hourly output per worker, which has been robust enough to largely contain wage costs.

As hiring picks up, however, some increase in wages -- the lions' share of production outlays -- seems inevitable.

In the first quarter of this year, nonfarm business productivity grew at a 3.8 percent annual rate. That was not enough to offset a 4.6 percent rise in hourly compensation, and unit labor costs rose.



 
  Today's Top News     Top World News
 

Beijing ready to talk with Taipei on 'three links'

 

   
 

China to lift restrictions on foreign banks

 

   
 

China opposes Japan's sea gas decision

 

   
 

New licensing law streamlines bureaucracy

 

   
 

Beijing's heritage status to be questioned

 

   
 

Fed raises rates, pledges gradual course

 

   
  US says attacks Zarqawi safehouse in Falluja
   
  Iraq to charge Saddam with war crimes
   
  Qatar convicts 2 Russian agents
   
  Not to everyone's taste, Rome changes colors
   
  Saddam lawyer says trial mockery of justice
   
  New Pakistan PM takes office
   
 
  Go to Another Section  
 
 
  Story Tools  
   
  Related Stories  
   
U.S. cuts rate to 45-year low to spark recovery
  News Talk  
  A "sovereign" Iraq? Do you believe it?  
Advertisement
         
主站蜘蛛池模板: 国产高清网站 | 精品国产aⅴ麻豆 | 亚洲视频免费在线观看 | 懂色av蜜臀av粉嫩av分享 | 日韩怡红院 | 成人毛片在线观看 | 婷婷免费视频 | 久久久久精 | 亚洲综合视频在线观看 | 成人免费毛片嘿嘿连载视频 | 久久人人爽人人爽人人片 | 大尺度做爰呻吟舌吻网站 | 日本在线看 | 亚洲一区二区三区四区在线 | 欧美性猛交一区二区三区精品 | 青草网| 午夜影院在线免费观看 | 久久96| 性av在线 | 国产午夜精品视频 | 日韩福利在线 | 成人免费高清视频 | 我要看一级黄色片 | 亚洲高清在线观看 | 天美传媒在线观看 | 日本视频一区二区三区 | 午夜视频在线看 | 成人网av| av天天干| 毛片www| 久久精品二区 | 亚洲综合区 | 一区二区三区四区在线视频 | 91在线免费看| 欧美日韩一二三区 | 女教师合集乱500篇小说 | 国产精品黄色片 | 官场少妇尤物雪白高耸 | 黄色免费大片 | www欧美 | 国产免费黄色片 |