Wednesday, May 10, 2006

Additional Policy Firming May Be Needed

From the Federal Reserve:

FOMC Statement

Release Date: May 10, 2006
For immediate release

The Federal Open Market Committee decided today to raise its target for the federal funds rate by 25 basis points to 5 percent.

Economic growth has been quite strong so far this year. The Committee sees growth as likely to moderate to a more sustainable pace, partly reflecting a gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices.

As yet, the run-up in the prices of energy and other commodities appears to have had only a modest effect on core inflation, ongoing productivity gains have helped to hold the growth of unit labor costs in check, and inflation expectations remain contained. Still, possible increases in resource utilization, in combination with the elevated prices of energy and other commodities, have the potential to add to inflation pressures.

The Committee judges that some further policy firming may yet be needed to address inflation risks but emphasizes that the extent and timing of any such firming will depend importantly on the evolution of the economic outlook as implied by incoming information. In any event, the Committee will respond to changes in economic prospects as needed to support the attainment of its objectives.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Susan S. Bies; Jack Guynn; Donald L. Kohn; Randall S. Kroszner; Jeffrey M. Lacker; Mark W. Olson; Sandra Pianalto; Kevin M. Warsh; and Janet L. Yellen.

In a related action, the Board of Governors unanimously approved a 25-basis-point increase in the discount rate to 6 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Dallas, and San Francisco.

12 Comments:

Blogger grim said...

A statement that Greenspan would be proud of.

grim

5/10/2006 01:40:00 PM  
Blogger minutesfromNYC said...

1/4 of a point...no suprises here..

5/10/2006 01:54:00 PM  
Anonymous Anonymous said...

Another dagger in the bubbleheads ego.

Housing Bust just around the corner.

Lean times are a coming bubbleheads.... get used to it.
Bababababababababababa
BOYCOTT HOUSES!!!!!

Booooooyaaaaaaa

Bob

5/10/2006 02:10:00 PM  
Anonymous Anonymous said...

BOYCOTT HOUSES!!!!

It's working...Prices are tunring down. bad news Bubbleheads.

"The average Bergen County sales price was $539,245 last month, about 1 percent below the average price in April 2005.”

Housing Pa pa pa pa pa pa PANIC!!

Booooooooyaaaaaaaa

Bob

5/10/2006 02:20:00 PM  
Anonymous Anonymous said...

No man is an island...with the possible exception of
Boooooyaaaaaa Bob.

Scha Scha Scha Scha Scha Scha Schadenfreude!

5/10/2006 02:26:00 PM  
Anonymous Anonymous said...

I'm keeping an eye on this property. The reserve is not too bad:

http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&item=4455060285

"Hardened buildings built to withstand One megaton nuclear blast within three thousand feet!!"

"Titan 1 ICBM Missile Base - Located in Washington State"

5/10/2006 02:31:00 PM  
Anonymous Anonymous said...

Look Unbelievable stuff coming out of this mess.
http://www.app.com/apps/pbcs.dll/article?AID=/20060509/NEWS/605090309

5/10/2006 02:35:00 PM  
Blogger chicagofinance said...

Given that things aren't messy yet, they are relatively messy.

5/10/2006 03:00:00 PM  
Blogger Van Housing Blogger said...

" Given that things aren't messy yet, they are relatively messy."

Funny and true!

Just imagine how messy it will be when things get messy!

5/10/2006 03:36:00 PM  
Anonymous Anonymous said...

"Just imagine how messy it will be when things get messy!"

Yes, that will be messy.

5/10/2006 07:02:00 PM  
Anonymous Anonymous said...

GUESS IT'S MESSY NOW, WILL BE MESSYER IN 07, BUT WILL O8 BE THE MESSYEST?

5/10/2006 08:21:00 PM  
Anonymous Rick J said...

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5/18/2006 04:40:00 PM  

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