- **Turkey's IIP moved to BPM6**
- Montenegro: Public Finance, HICP (Nov)
- Netherlands: LFS (Nov)
- Euro area: Construction Output (Oct)
- Sweden: Business Tendency Survey, Consumer Confidence (Dec); Iceland: HICP (Nov)
- Germany: IFO Business Climate Survey Summary (Dec)
- Spain: Services Price Indexes (Q3), Export & Imports Prices (Oct)
- Ivory Coast: IP (Oct); South Africa: PPI (Nov), Export & Import
- more updates...
Economy in Brief
U.S. Consumer Prices Post Largest Decline Since 2008; Core Prices Moderate
Inflationary pressures remain well contained...
U.S. Current Account Deficit Deepens Slightly
The U.S. current account deficit deepened in Q3'14 to $100.3 billion from $98.4 billion in Q2...
U.S. Mortgage Loan Applications Decline; Interest Rates Little-Changed
The MBA total Mortgage Market Volume Index fell 3.3% last week (-3.9% y/y)...
EMU's HICP Stays 1.7% Below Targeted Pace
The euro area's HICP inflation is up by 0.3% year over year...
U.S. Housing Starts & Building Permits Ease
Housing starts during November declined 1.6% to 1.028 million (AR, +7.5% y/y) from 1.045 million in October...
U.S. Crude Oil and Gasoline Price Declines Continue
WTI crude oil prices declined 9.0% last week to an average $61.11 per barrel (-37.1% y/y)...
by Tom Moeller December 17, 2014
At today's meeting of the Federal Open Market Committee, the Fed indicated, "Based on its current assessment (of the economy), the Committee judges that it can be patient in beginning to normalize the stance of monetary policy." The Fed also indicated that despite improvement, "economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run."
Several indicators of economic improvement were noted including "solid" job gains and a lower unemployment rate. Consumer spending and business investment were seen to have risen moderately. The housing recovery, however, was judged to be slow.
Lower energy prices were seen as holding the overall inflation rate down. The Fed also indicated that "longer-term inflation expectations have remained stable."
The Fed released its updated projections for economic activity. Real GDP is expected to grow 2.8% next year and in 2016, before slowing to 2.4% in 2017. The unemployment rate is expected to fall from 5.25% in 2015 to 5.10% in 2017. PCE inflation should total 1.3% next year then 1.9% both in 2016 and 2017. Core price growth of 1.7% is projected for next year then 1.9% in 2016 & 2017.
The press release for today's FOMC meeting can be found here.
The backdrop to today's meeting was slower M2 growth of 6.0% y/y and little growth in the monetary base.
Haver's SURVEYS database contains the economic projections from the Federal Reserve Board.
|Federal Funds Rate, % (Target)||0.00-0.25||0.00-0.25||0.11||0.14||0.10||0.17|
|Discount Rate, %||0.75||0.75||0.75||0.75||0.75||0.72|