US: Fed divided on fiscal stimulus effect on growth
Members of the Federal Open Market Committee (FOMC) are divided on how President Donald Trump's fiscal stimulus package will affect the U.S. economy, minutes from a Federal Reserve meeting showed Wednesday, APA reports quoting Anadolu Agency.
"About half of the participants did not incorporate explicit assumptions about fiscal policy in their projections," details form the March 14-15 meeting read.
It said, on the other hand, half of the members included fiscal stimulus into their expectations and project "slightly higher real GDP growth next year”.
Members, however, mostly agreed that any meaningful fiscal stimulus and its effect on the economy would not likely start until the beginning of next year.
Trump has promised to lower corporate tax rates and spend at least $1 trillion on infrastructure but has provided little details.
With improving economic conditions, the Fed increased interest rates by 25 basis points on March 15. The minutes said rate hikes would continue gradually as long as "the economy continued to perform about as expected”.
Raising interest rates, however, is tied to the Fed reducing its $4.5 trillion balance sheet this year, which includes government bonds and mortgage securities.
The assets were acquired during and after the 2007 financial crisis, when the central bank lowered interest rates to almost zero percent and began accommodation to make money easier to borrow to stimulate growth.
During that time, the Fed’s holdings rose from less than $1 trillion to $4.5 trillion.
Since the Fed began to gradually end accommodation and is now increasing interest rates, it is time to gradually phase out those assets, according to fundamentalists.
Related news releases
- 28.06.2018Azerbaijani President approves Action Plan on improvement of control system over import and export operations
- 23.04.2018Trade turnover between Azerbaijan and Russia increases by 32% in Q1
- 23.04.2018Azerbaijan to produce small trucks jointly with Russia
- 06.04.2018Export on non-oil sector in two months amounts to $241.7M
- 15.03.2018Number and salary of workers in economy announced
- 15.03.2018Google bans cryptocurrency advertising, bitcoin price slumps
- 13.03.2018Minister: Iran to lease private hospital in Azerbaijan
- 12.03.2018Azerbaijan to host international food industry exhibition
- 12.03.2018Registration for CEO Lunch Baku ongoing
- 09.03.2018Azerbaijani Central Bank announces manat's average rate
- 01.03.2018Activity directions of Agency for Development of Small and Medium-Sized Enterprises of Azerbaijan announced - INTERVIEW
- 27.02.2018Ilham Aliyev: Our main goal is to increase non-oil export
- 12.02.2018Amazon cutting hundreds of jobs: Seattle Times
- 08.02.2018President Ilham Aliyev receives Senior Executive Vice President of Thales International
- 08.02.2018US crude production hits record, passing Saudi Arabia
- 07.02.2018Company illegally operating in Nagorno Karabakh prevented from participating in exhibition in Russia
- 06.02.2018Azerbaijani president approves amendment to Law on Entrepreneurial activity
- 31.01.2018Fed holds interest rates steady
- 31.01.2018Authority to be created for management of Alat free trade zone
- 22.01.2018Trade turnover between Azerbaijan and Georgia exceeds $880M in 2017
- 18.01.2018Azerbaijan gets 2% rise in consumption market in 2017
- 12.01.2018‘Mover’: No problem in goods delivery to Azerbaijan
- 11.01.2018Azerbaijan increases amount of funds for organizing export missions to foreign countries
- 11.01.2018Azerbaijan will organize purchase missions for foreigners
- 29.12.2017Entrepreneurial activity divided into four subjects in Azerbaijan
- 28.12.2017Agency on Development of Small and Medium Entrepreneurship established under Ministry of Economy
- 27.12.2017Caspian European Club compiles annual investment rating of economic regions of Azerbaijan
- 26.12.2017Azerbaijani billionaires buy one of Russia’s largest sports complexes
- 25.12.2017Excise on import of beers and alcoholic drinks increased in Azerbaijan
- 25.12.2017Excise on tobacco and tobacco products imported to Azerbaijan doubles
- 15.12.2017President: Facilities to put an end to dependence on import are launched in Azerbaijan
- 13.12.2017Azerbaijani businessman sells Cherkizovo at $2B
- 12.12.2017Apple confirmed Monday it has acquired the music discovery app Shazam, APA reports quoting Anadolu Agency.
- 07.12.2017President: 5,000 people illegally working in construction started to work on the basis of labour contracts within a few months
- 07.12.2017Azerkhalcha OJSC opens branch in Guba
- 04.12.2017Ministry: Fares paid by clients for taxi services are free of VAT
- 30.11.2017US Ambassador to Become Honorary Guest of CEO Lunch Baku
- 29.11.2017Azerbaijani president receives delegation of CISCO company - UPDATED
- 28.11.2017Azerbaijani president inaugurates bread and flour plant in Agjabadi
- 21.11.2017Telman Ismayilov: I also have something to say
- 08.04.2017Deputy PM: Creation of Food Safety Agency aims to eliminate problems in Azerbaijan’s food safety system
- 08.04.2017Ambassador: Any violation of Azerbaijani businessmen’s rights to draw immediate reaction
- 11.04.2017Tesla becomes most valuable U.S. car maker, edges out GM
- 28.03.2017Highest development indicators in world scale are in Azerbaijan – president
- 28.03.2017Azerbaijan referred to as exemplary country in combating unemployment - president
- 28.03.2017Entrepreneurs should be active, get access to new markets – president