FOMC raises funds rate target 25 basis points

The Federal Open Market Committee voted to raise the fed funds rate target 25 basis points to between 1% and 1.25%.

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Neel Kashkari, president and chief executive officer of the Federal Reserve Bank of Minneapolis, speaks at the Economic Club of New York in New York, U.S., on Wednesday, Nov. 16, 2016. Kashkari unveiled his four-step "Minneapolis Plan," which he said would eliminate the too-big-to-fail problem among financial institutions whose failure could wreak havoc in global financial markets. Photographer: Mark Kauzlarich/Bloomberg

Federal Reserve Bank of Minneapolis President Neel Kashkari dissented, preferring to hold rates steady.

There were no hints in the statement about future hikes, although the Summary of Economic Projections showed one more this year.

The FOMC statement said the panel "expects to begin implementing a balance sheet normalization program this year, provided that the economy evolves broadly as anticipated." The Fed plans to “cap” Treasuries at $6 billion a month to start and increase in $6 billion increments over three-month intervals for a year, until it reaches $30 billion a month.

For mortgage backed securities, the FOMC expects a $4 billion a month cap, rising $4 billion at three-month intervals until it reaches $20 billion a month."

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Monetary policy FOMC
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