Advisories
December 14, 2010 Posted by:
Debi Hanson
The Federal Reserve Open Market Committee voted Tuesday to keep the federal funds rate unchanged at zero to 0.25 percent, where it has been since December 2008. The committee stated it will leave all policies unchanged and it affirmed the "quantitative easing" target of $600 billion in Treasury purchases, subject to regular reviews. The Fed is seeing a gradual continuing of the economic recovery, but at a very slow pace. The recovery is constrained by the unemployment issues, low income growth, lower home and housing wealth, and tight credit. Business spending is rising for both equipment and software, but less so than earlier this year. Longer-term inflation measures remain subdued.
Voting against the decision again (10-1) was the Kansas City Fed President, Thomas Hoenig. Hoenig reiterated his concern "that the continued high level of monetary accommodation would increase the risks of future economic and financial imbalances and, over time, would cause an increase in long term inflation expectations that could destabilize the economy."
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Today's Federal Reserve Meeting AnnouncementDecember 14, 2010 Posted by: Debi HansonThe Federal Reserve Open Market Committee voted Tuesday to keep the federal funds rate unchanged at zero to 0.25 percent, where it has been since December 2008. The committee stated it will leave all policies unchanged and it affirmed the "quantitative easing" target of $600 billion in Treasury purchases, subject to regular reviews. The Fed is seeing a gradual continuing of the economic recovery, but at a very slow pace. The recovery is constrained by the unemployment issues, low income growth, lower home and housing wealth, and tight credit. Business spending is rising for both equipment and software, but less so than earlier this year. Longer-term inflation measures remain subdued.
Voting against the decision again (10-1) was the Kansas City Fed President, Thomas Hoenig. Hoenig reiterated his concern "that the continued high level of monetary accommodation would increase the risks of future economic and financial imbalances and, over time, would cause an increase in long term inflation expectations that could destabilize the economy."
SVB Asset Management, a registered investment advisor, is a non-bank affiliate of Silicon Valley Bank and member of SVB...
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