Fed Officials Say Economy Is Ready for Higher Rates

Fed Officials Say Economy Is Ready for Higher Rates
In the policy statement the Fed issued after the January meeting, the central bank outlined its approach to raising rates, saying it “expects
that economic conditions will evolve in a manner that will warrant further gradual increases in the federal funds rate.”
The meeting account said the addition of the word “further” in
that statement reflected the increased confidence among officials that the Fed would continue raising rates.
WASHINGTON — Robust economic growth has increased the confidence of Federal Reserve officials
that the economy is ready for higher interest rates, according to an official account of the central bank’s most recent policymaking meeting in late January.
The Fed did not raise its benchmark interest rate at the meeting on Jan. 30 and 31,
but the account reinforced investor expectations the Fed would raise rates at its next meeting in March.
The account said Fed officials have upgraded their economic outlooks since the beginning of the year
and listed three main reasons: The strength of recent economic data, accommodative financial conditions and the expected impact of the $1.5 trillion tax cut that took effect in January.
Most Fed officials predicted in December the Fed would raise rates three times in 2018, as it did last year.
The Fed is seeking to raise rates gradually to maintain control of inflation without impeding an economic expansion
that is nearing the end of its ninth year, one of the longest stretches of continuous economic growth in American history.