The IBD editors didn’t like what they heard from the Fed:
As the Fed hinted in its biannual policy forecast, the famously dynamic U.S. economy is looking rather undynamic these days. The Fed lowered its forecasts for economic growth next year considerably, from a range of 3% to 3.2% just two months ago to 2.6% to 3% now.
When officials have to scramble to lower their forecasts to catch up with reality, it’s rarely a good thing. That’s certainly the case here.
And yet, while most of the Fed board’s members continue to forecast an end to the Fed’s 0% interest rate policy sometime next year, this latest forecast raises some doubts about that.
The Fed’s Open Market Committee said in a statement that “it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase ends.”
Sound like the Fed’s going to hold on to the zero-rate policy as long as it can out of fear increases will sink the economy? It sure did to us.
We can’t afford much more of this cheap money.