The Economic Perspective: “Is the Fed Pausing?”

I’m Mary Walden with economist MW, welcoming you to the economic perspective.  Today’s program asks if the Fed is pausing.  Mike, the Federal Reserve is being avidly followed for hints about what they will do about interest rates in 2019.  The Fed is coming off a two-year period of consistently raising rates, and some now are concerned their moves could slow or even end growth in the economy.  Recently the Fed has given hints they may pause in their interest rate hike in 2019.  Will they?

 

Mike:  Summary Answer

  1. Fed Chair Powell has suggested a pause in several statements
  2. But he has also said the Fed’s moves will be data-driven – meaning, in

particular, it will watch inflation

  1. Always divided views on the Fed
  2. Some say there are no signs inflation is overheating, so Fed should pause
  3. Others say that, after accounting for inflation, real interest rates are zero, so Fed hasn’t tightened
  4. Then there is Fed sales of assets
  5. Next Fed meeting – end of January
  6. I’m MW

 

Mary:  And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.