Uncertainty over Federal Reserve’s Plans to Increase Interest Rate no Longer Impacting US Economic Recovery

Uncertainty over Federal Reserve’s Plans to Increase Interest Rate no Longer Impacting US Economic Recovery

National Association of Business Economists has released a survey of economists with majority expecting a Federal Reserve interest rate hike in second half of the current year. A number of questions were asked in a poll conducted by the National Association of Business Economists. In the survey in which 293 economists took part unveiled that majority of economists do not think that uncertainty over when the Federal Reserve will increase interest rates is no more slowing the US economic recovery.

Seventy-one percent of the 293 economists said that they expect the Federal Open Market Committee to increase the federal funds target rate this year. But even if takes longer than that then also its much unlikely to have negative impact on the level at which economic recovery is taking place.

The survey carried out before the Federal Reserve Chair Janet Yellen presented her semiannual economic report to Congress at the end of February. Yellen affirmed that the Fed continues to be 'patient' indicating that a rate hike is likely not possible before at least June.

Yellen also affirmed that US economic condition is now improving. Now, unemployment rate is 5.7%, which is quite low from a high of 10% in late 2009. However, "too many Americans remain unemployed or underemployed, wage growth is still sluggish and inflation remains well below our longer-run objective", asserted Yellen. Economists were asked on many policy issues.

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