The Federal Open Market Committee issued an unusually short statement, using only 320 words. Compared with the previous statement, this statement has changed several words, implying a more optimistic view of economic growth and higher inflation expectations.
The Committee said that economic growth is "growing at a steady rate", and the wording was raised from the previous "moderate". The unemployment rate has been "reduced" rather than "kept at a low level", and household expenditure has been "picked up", which is better than the previous "relaxation". With this in mind, the Committee indicated that it was appropriate to raise interest rates again.
The statement said: "The Committee expects that the further gradual increase in the target range of the federal funds rate will be consistent with the sustained expansion of economic activities, the strong labor market situation and inflation near the Committee's medium-term symmetrical 2% target."
Data Map: Federal Reserve Chairman Powell. ?
Committee members said in their quarterly economic forecasts that they expected the core inflation rate to reach the Fed's target of 2% by the end of this year, and now they expect the annual economic growth to reach 2.8%.
The forecast of GDP and personal consumption is 0. 1 percentage point higher than that in March. Apart from raising GDP and inflation, members of the Committee also lowered their forecasts of unemployment rate. They predict that the unemployment rate will reach 3.6% by the end of this year, compared with 3.8% in March.
The Committee also said that it is expected that there will be three more interest rate hikes in 20 19 and four more this year.
The "bitmap" of the Fed shows that eight Fed officials expect to raise interest rates four times or more this year, which means that Fed policymakers expect to raise interest rates twice this year and three times in 20 19.
After the news of interest rate hike came out, US stocks fell for a short time. The dollar rose sharply, and the yield of US bonds rose sharply.