Federal Reserve believes interest hike could be ‘relatively soon,’ minutes show

Federal Reserve Chairwoman Janet Yellen testifies at a Joint Economic Committee hearing in Washington, D.C., on Nov. 17. At the hearing, Yellen said interest rates could be raised by the U.S. central bank "reltively soon" -- a statement the Federal Open Market Committee made at its last policy meeting on Nov. 2, the meet's minutes report showed Wednesday. Photo by Kevin Dietsch/UPI

WASHINGTON, Nov. 23 (UPI) — The U.S. Federal Reserve believed in the days before the presidential election that raising key interest rates for the first time in 2016 could happen “relatively soon.”

The Federal Open Market Committee decided to leave rates unchanged at its last policy meeting three weeks ago, but concluded at that meeting that economic signals indicated that the federal funds rate might soon be raised.

The FOMC’s train of thought was detailed Wednesday with the release of the Fed’s Nov. 2 minutes report.

“Most participants expressed a view that it could well become appropriate to raise the target range for the federal funds rate relatively soon, so long as incoming data provided some further evidence of continued progress toward the Committee’s objectives,” the report states.

The U.S. central bank’s last policy meeting took place six days before the surprise election of Donald Trump — and the spectacular Wall Street surge that has followed, which analysts believe is a factor that virtually assures a rate hike at the FOMC’s next and last policy meeting of 2016 on Dec. 14.

The Fed indicated that continuing sub-2 percent inflation continued to be a primary factor in leaving rates unchanged this year. The last rate hike happened in December 2015, after nearly a decade of rates near zero.

Last week, Federal Reserve Chair Janet Yellen foreshadowed the minutes report by saying the next increase could happen “relatively soon.”


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