Daily News: August 21, 2014

Fed ‘Increasingly Uncomfortable’ Keeping Rates Low

Citing minutes from the FOMC meeting in July, Bloomberg reported that improving labor markets are bringing the Fed closer to a time where there’s a tighter connection between changes in economic data and movements in short-term interest rates.

Bloomberg said, citing the minutes, some Fed officials “were increasingly uncomfortable” with the committee’s forward guidance on keeping its benchmark rate low for a “considerable time.” “Many” participants said they might have to raise borrowing costs sooner than they had anticipated, Bloomberg noted.

Fed officials “noted that if convergence toward the committee’s objectives occurred more quickly than expected, it might become appropriate to begin removing monetary policy accommodation sooner than they currently anticipated,” Bloomberg said, citing the minutes.

To read the entire Bloomberg report, click here.

To link to the Federal Reserve FOMC meeting minutes, click here.