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
- 23.06.2017President: Azerbaijan’s export increased more than 40%
- 22.06.2017Baku to host 5th CEO Lunch
- 19.06.2017Retail trade turnover increases 2% in Azerbaijan
- 19.06.2017Trade turnover between Azerbaijan and Georgia increases 45%
- 13.06.2017Ministry: Over 6,800 foreigners did not obtain work permit last year
- 13.06.201784 died, 165 injured at work in 2016
- 17.05.2017Gilan Holding doubles export of agricultural products
- 15.05.2017SCC releases statement on reports regarding import of Armenian products to Azerbaijan
- 10.05.2017UK company illegally operating in Nagorno Karabakh warned
- 26.04.2017Azerbaijani companies deny participating in Yalta economic forum
- 26.04.2017Ambassador: Turkish businessmen’s investments in Azerbaijan exceed $9M
- 20.04.2017Russia’s richest Azerbaijani businessmen earn $5B, lose $300M
- 18.04.2017Minister: The volume of non-oil exports is not at the desired level
- 17.04.2017Azerbaijani president: Trade houses should be created in Gulf countries
- 17.04.2017President: “We should train specialists on export”
- 17.04.2017Big sale networks should be invited to Azerbaijan – president
- 17.04.2017Arms trade already brings large amount of currency to Azerbaijan – president
- 17.04.2017“Made in Azerbaijan” brand already famous in world – president
- 17.04.2017Azerbaijan increases non-oil export – president
- 13.04.2017Trump's message to bankers: Wall Street reform rules may be eliminated
- 12.04.2017Azerbaijan gives investment promotion certificate to 121 projects
- 17.03.2017CIS Economic Council developing concept of gradual formation of common labor market
- 14.03.2017Inflation in Azerbaijan made up 1.6% last month
- 03.03.2017Mercedes recalls 354,000 vehicles in US
- 02.03.2017Five Azerbaijanis among Russia’s richest people
- 22.02.2017Baku Business Factory and TransTech Capital sign MoU
- 14.02.2017Ministry of Economy warns economic entities
- 02.02.2017Google becomes world's most valuable brand
- 01.02.2017State duty for granting of licenses for mobile services to make up AZN 1M
- 26.01.2017Azerbaijani businessmen – king of Russia’s real property
- 18.01.2017President: Azerbaijan entered a new stage of development - UPDATED
- 16.01.2017Oil price rise will cause Turkey to increase export to Azerbaijan - International Transporters' Association
- 11.01.2017BMW goes to law for declaring Telman Ismayilov’s son bankrupt
- 10.01.2017Azerbaijani billionaire earns $1.8B after Trump’s victory
- 28.12.2016Sumgayit Superfosfat OJSC owes AZN 3M
- 20.12.2016Tax amnesty to concern 45,000 taxpayers - UPDATED
- 20.12.2016Committee chairman: Tax amnesty to leave AZN 600M to entrepreneurs
- 19.12.2016Azerbaijan may launch tax amnesty - EXCLUSIVE
- 16.12.2016Amount of money Donald Trump received from branding deal in Baku announced
- 09.12.2016Iraqi businessmen intend to invest in Azerbaijan
- 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