Fed Still Saying Exceptionally Low Rates for Extended Period - Update 2
The first scheduled FOMC meeting of 2010 ended this afternoon, and the press release looks like a copy of December's press release. There continues to be no hint of when the Fed will start hiking rates. The Fed continues to say the same thing about keeping the federal funds rate exceptionally low for an extended period:
The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period.
A small change did occur. One committee member, Thomas Hoenig, voted against the policy action. Hoenig is one of the few inflation hawks. He's now a voting member on the committee for 2010. Here is an excerpt from the press release regarding his vote:
Voting against the policy action was Thomas M. Hoenig, who believed that economic and financial conditions had changed sufficiently that the expectation of exceptionally low levels of the federal funds rate for an extended period was no longer warranted.
Note, he was only against the expectation of exceptionally low levels which seems quite reasonable. Unfortuantely, he was the only member voting this way.
On related news, it looks like Bernanke will be serving another four years as Federal Reserve Chairman. According to the Washington Post, "The Senate on Tuesday moved to clear the way to confirm Ben Bernanke to a second term as Federal Reserve chairman, setting a procedural vote for Thursday in a sign that the needed votes were now secured."