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By Philippe Weber – Head of Strategy, CPR Asset Management
In itself, the status quo was expected : with no advance warning and with the Brexit referendum looming, the FOMC could hardly raise the federal funds rate. The actual surprise was in the associated projections.
The FOMC members remained moderately optimistic. Compared to the March 2016 assessments, their forecasts, as far as GDP is concerned, were almost unchanged for 2017 and 2018 , with a 2% growth envisioned for both years.
The inflation prospects were unchanged at 1,9% for 2017 and 2,0% for 2018 – that is to say, the economy is on its way to reach the inflation objective of 2% in the medium term. Finally, the unemployment (the other part of the dual mandate of the...
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