Chair Jay Powell is discovering the U.S. Fed’s new normal along with everyone else. New stress in America’s money markets, though, is partly its own handiwork, writes richardbeales1.
The U.S. Federal Reserve’s policy-setting committee on Sept. 18 cut its target overnight interest rate range by a quarter percentage point, to 1.75%-2%.
The Federal Open Market Committee’s statement noted the dissent of three voting members from the decision, one of whom preferred a half-point cut while two preferred to leave rates unchanged. And new projections by Fed board members and regional bank presidents showed the median forecast is for rates to be unchanged at the end of 2019 and 2020.
The central bank also widened the gap between the interest it pays banks on excess reserves and the top of its policy rate range, a step taken to smooth out problems in money markets that prompted a market intervention by the New York Fed. The Fed on Sept. 18 offered to pump as much as $75 billion into U.S. money markets through an overnight repurchase agreement operation after the costs for securing overnight repurchase agreements spiked. Banks took $53 billion under a similar offer the previous day. It was the first time the federal funds rate had drifted outside the central bank’s target range since the financial crisis over a decade ago.
Brasil Últimas Notícias, Brasil Manchetes
Similar News:Você também pode ler notícias semelhantes a esta que coletamos de outras fontes de notícias.
New York Fed carrying out repo operation to keep fed funds rate in target rangeThe New York Federal Reserve bank said it was carrying out up to $75 billion worth of repuchase agreements, or repo, on Tuesday between 9:30 a.m. Eastern to...
Consulte Mais informação »
Stocks open slightly lower as Fed begins two-day meetingStocks opened slightly lower Tuesday as Federal Reserve policy makers were set to begin a two-day meeting expected to conclude with another quarter-point cut...
Consulte Mais informação »
Fed rate cut is coming, but corporate insiders still doubt it is necessaryA Federal Reserve rate cut at the end of this week's two-day FOMC meeting is considered a 'lock' by the market, but chief financial officers of major corporations still harbor doubts about whether lowering interest rates is necessary.
Consulte Mais informação »
Fed Steps Into Repo Market to Control Soaring RatesThe Federal Reserve Bank of New York entered the money markets with up to $75 billion of transactions to tamp down rising interest rates that had threatened the central bank’s control of its benchmark fed-funds rate.
Consulte Mais informação »
Oil sheds gains, stocks dip as Fed comes into focusIn the US, gasoline prices jumped after crude oil futures spiked nearly 15 percent following weekend attacks on Saudi Arabian oil facilities.
Consulte Mais informação »
Fed expected to cut rates and Powell may have hard time appeasing critics inside and outside FedThe Fed is expected to cut rates Wednesday, but it is unlikely to tell markets what they want to hear on future rate cuts.
Consulte Mais informação »