Semi-Daily Journal Archive

The Blogspot archive of the weblog of J. Bradford DeLong, Professor of Economics and Chair of the PEIS major at U.C. Berkeley, a Research Associate of the National Bureau of Economic Research, and former Deputy Assistant Secretary of the U.S. Treasury.

Wednesday, October 25, 2006

The Federal Reserve Stays the Course

Felix Salmon writes:

RGE - Fed: No rate cuts in the offing?: As expected, the Fed kept rates on hold at 5.25%. But there doesn't seem to be much in the way of bearishness at the FOMC: the statement says that "going forward, the economy seems likely to expand at a moderate pace". It goes on to talk about "the extent and timing of any additional firming that may be needed" -- no one at the Fed seems to be anticipating any rate cuts for the foreseeable future.

The economic forecasters seem to have a different view: their dominant view seems to be that they are expecting reality to lead the Fed to cut some in 2007.

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