Fed Signals It May Slow Pace of Rate Hikes

The Federal Open Market Committee may slow its future progress on raising interest rates due to rising downside risks -- including slower global growth, trade tensions and recent market volatility -- according to minutes from the Dec. 18-19 meeting released today. At the conclusion of that meeting, members voted to move ahead with another 25 basis point increase in the federal funds rate. 

Though the current economic indicators remained strong, “participants generally revised down their individual assessments of the appropriate path for monetary policy” due to downside risks. FOMC members noted that they “could afford to be patient about further policy firming.” 

Members revised their post-meeting statement to indicate that “the Committee judges that some further gradual increases” may be appropriate in the future, signaling a slowdown in anticipated rate hikes and emphasizing that future determinations would be heavily dependent on incoming data. Read the minutes of the Federal Open Market Committee.