By Victoria Craig Published June 14, 2017 The Fed FOXBusiness The Federal Reserve on Wednesday raised the short-term federal funds rate and maintained its forecast for at least one more rate rise in 2017 with plans to begin shrinking its balance sheet later this year.
At the conclusion of its two-day policy meeting, the Federal Open Market Committee moved its benchmark interest rate higher by 0.25 percentage point to between 1% and 1.25%, as had been widely expected on Wall Street.
All but one member of the FOMC, Minneapolis Fed Chief Neel Kashkari, voted in favor of the decision, the fourth rate rise in 18 months, due to continued strength in the labor market, moderate economic activity and higher household spending so far this year.
At the same time, members of the committee lowered their unemployment rate forecast to 4.3% this year while also expecting inflation to remain stubbornly low through the rest of the year but rising closer to its 2% target in the longer term.
At the same time, the core measure of consumer price inflation, which strips out volatile swings in food and energy costs, slipped 0.1% for the month, posting a 1.7% gain from the year prior, and missing economists’ expectations for the third month in a row for a figure closer to the 2% range.