March 08: Fed cuts rates to 2.25
Posted March 19, 2008on:
Another month, another 75 basis point rate cut by the Fed. This is (close to) what the market expected, so I can’t imagine that it would have much impact on anything. However, the statement was interesting.
Does anyone else find it interesting that the Fed cut rates by 75 basis points but still wrote a whole paragraph (1/3 of the meaty bit) on the risk of accelerating inflation compared to last time when they said:
The Committee expects inflation to moderate in coming quarters, but it will be necessary to continue to monitor inflation developments carefully.
The most interesting bit was:
Still, uncertainty about the inflation outlook has increased. It will be necessary to continue to monitor inflation developments carefully.
If the CPI measure ticks up, will this be the end of rate cuts?