InvestorQ : Do you see the latest Fed statement issued last week any different from its previous statements on the US economy?
Archita Jajjoo made post

Do you see the latest Fed statement issued last week any different from its previous statements on the US economy?

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Niti Shenoi answered.
5 days ago
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The Fed statement after its 28 April meet was almost the same, except that the Fed flagged risks of higher GDP and higher inflation as risks to low rates. However, even as the Fed ruled out rate hikes, the US GDP growth touched an 18-year high of 6.4% in Mar-21 quarter. The big shift was the acknowledgement that inflation and GDP were back to pre-COVID levels.

The policy states that it did no see reasons to hike rates unless GDP growth and inflation were of a sustainable nature. Meanwhile, the Fed also promised to continue its bond buying program worth $120 billion per month, well through 2021 and beyond. Fed’s view is that inflation is supply-driven and should reduce with the supply chain constraints. Also, Fed wants to keep money easy, till there were indications of even and stable growth.

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