The US Federal Reserve raised the benchmark Fed Funds rate by 25 basis points to a range of .75% to 1%.
The FED’s “Dot Plot” Table of FED members’ projections for short-term interest rates showed three hikes in 2017, three in 2018 and three in 2019, which is unchanged from the prior forecast in December.
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While the rate adjustment was expected, the unchanged forward guidance in the dot plots fell short of the street’s expectations. Many analysts’ were looking for a higher rate trajectory into the middle of 2018.
One reason given for the cautious outlook was the sharp fall in GDP growth for Q1 2017.
The Atlanta FED GDPNow tracker has been revised down to .9% from 1.9% in December.
