The Fed decision was in line with market expectations. Dot charts shows that rates should stay close to zero to 2023 and long term rate is at 2.5%. Fed will keep the pace of QE program unchanged. Fed sees improvement in economic activity and jobs, but still sees considerable risks over the medium term. It is also worth to note that 4 members see rate hike in 2023, but median stays close to zero.
Fed changed its language about inflation by saying that it “will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer-term inflation expectations remain well anchored at 2 percent”.
Reactions on the market are calm and positive for stocks. Source: xStation5
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