Federal Reserve Chair Janet Yellen (Photo : Reuters)
A lot of people were confused after officials issued a statement pertaining to central bank's monetary policy plans involving interest rate hike, Bloomberg reported. The World Wide Web was bombarded with news concerning about rate increase that is said due to economic conditions such as improved employment and improved job creation.
Because of this, Federal Reserve Chair Janet Yellen clarified that Fed will not change any policy and that there's no rate increase come first quarter of 2015. Yellen said on Wednesday that borrowing costs would stay low. She also pointed out that it is unlikely for central bank to push with the move before end of April 2015.
Members of the committee said that they are still expecting growth in the economy and are expecting that unemployment rate will still fall from its current rate.
Fed Reserve Chair Janet Yellen also said, "The statement that the committee can be patient should be interpreted that it is unlikely to begin the normalisation process for at least the next couple of meetings," which will be held in January and March 2015.
Though they did not gave any specific date on when the rate hike will happen, some officials and experts are eyeing that there would be a rate hike in June and some of them says September, as cited by Shanghai Daily. In addition, a survey that was made in November to 19 Wall Street companies by Reuters suggests that an expected increase will happen by the month of June.
It is also worthy to note that for the last eight years, Fed has not made any increase on interest rates.
