Tag Archives: Federal Funds Target Rate

Ask the Economist is an ongoing series in which DS News talks with an economist about the most pressing issues facing the nation's housing industry and the economy. This installment features Rodney Ramcharan, Associate Professor of Public Policy and Research Director of the USC Lusk Center for Real Estate.

An influential monetary policymaker said this week that it would be appropriate for the Federal Reserve to raise the federal funds target rate later this year despite declining to do so in the September meeting of the Federal Open Market ...

"In determining how long to maintain this target range, the Committee will assess progress—both realized and expected—toward its objectives of maximum employment and 2 percent inflation," the Fed said in a statement.

Kaushik Basu, Chief Economist for World Bank, said on Wednesday that the U.S. central bank should delay a rate hike until the global economy stabilizes. Basu said it would have negative consequences if the Fed raises rates now due to economic uncertainty in China and the effect it has on global markets.

At a press conference following a speech on the regional economic outlook in Buffalo on Wednesday morning, New York Fed president and CEO William C. Dudley expressed the idea that a rate hike at September's Federal Open Market Committee meeting seemed "less compelling" than it was a few weeks ago following the turbulent stock market activity earlier in the week.

FOMC chair Janet Yellen revealed at a mid-July House Financial Services Committee hearing that rates would be raised upon improving economic conditions at no particular time.

Also of note, job gains for May and June were revised upward for a combined total of 14,000 more jobs than were originally reported, according to the BLS. Smoke said the job growth in the last year, which has been consistently strong in the last nine months, has been a key reason for stronger housing demand this year.