The Fed now sees the unemployment rate ending the year at 4.3 percent, where it sits currently, rather than the 4.5 percent previously expected. That gauge is called core Personal Consumption Expenditures, and it was up just 1.5 percent in the 12 months ending in April.
Experts said that the State Bank of Viet Nam's policies on exchange rates helped the market avoid external shocks, adding that the Fed rate hikes would not have significant impacts on VND/USD exchange rates.
Economist-expert Parviz Heydarov said that the US economy is now completely out of a hard situation. "It looks like as it stands, policy normalization is still on track, but [the Fed] are watching inflation developments", Jennifer Lee, senior economist at BMO Capital Markets, told MarketWatch. Household spending has picked up in recent months, and fixed investment by business has continued to expand.
Although inflation has declined recently and, like the measure excluding food and energy prices, is running somewhat below 2 per cent in the near term, the Fed expects it to stabilize around the committee's 2 per cent objective over the medium term. "And even with some moderation in the pace of job growth, we have a labor market that continues to strengthen".
The Federal Open Market Committee also maintained its forecast for one more rate hike this year.
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However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data.
Meanwhile, in view of stable economic conditions, the Fed plans to reduce its 4.5-trillion-U.S. -dollar balance sheet later this year and unveiled a detailed plan to trim its bond holdings.
Your credit card issuer or home equity lender is about to bump up your interest rate again, as Federal Reserve Board Chair Janet Yellen and her colleagues have raised a key short-term rate for the third time since December.
Despite a flow of weak economic data in recent months, markets had expected the Federal Reserve's decision today to hike the federal funds rate and boost the amount it pays on its reverse repo facility. The yield on the 10-year Treasury note was 2.12 percent, the same as shortly before the statement came out.
United States 10-year Treasury yields were last at 2.134 percent, below their U.S. close of 2.138 percent.
On Wednesday, the dollar index barely budged as slightly firmer moves against the euro and yen were offset by losses against the commodity bloc of currencies, such as the Australian and Canadian dollars. European stocks dropped to April lows, with miners selling off as Bloomberg's commodity index fell to the lowest in more than a year.