Wednesday May 27, 2015
After six years of an essentially 0% federal funds rate target, liftoff is just around the corner. But, based on comments made by Federal Open Market Committee (FOMC) members, that corner keeps moving.
Before the January FOMC meeting, we found that of the fifteen FOMC members, three were looking for a rate hike in the first half of 2015 and one was saying it would occur in the second half. Prior to the March meeting, six members were looking for a rate hike in 2015. Prior to the April FOMC meeting, ten seemed in favor of a rate hike in 2015.
Economic data in April suggested U.S. economic growth slowed in the beginning of 2015. Of the six monetary-policy related public interviews or speeches by FOMC members that were delivered after the April FOMC meeting, four members continued to look for a rate hike in 2015 and the other two believed a rate hike wouldn’t be appropriate until 2016.
The graphic below, which will be updated for upcoming meetings, allows you to track how FOMC members have adjusted their estimates of “take off.” The photos of voting members are shown in circles with nonvoting members in squares. Key economic indicators are shown on the right (where the data shown represent the original estimates that were available at the time of the meeting rather than more recent revisions).
Below the graphic is a table highlighting each FOMC member’s view on the timing of liftoff with a link to the full text of the corresponding speech or interview.
For now, it looks like liftoff is off the table for June but still possible by year’s end. As many Fed officials say, the exact time of liftoff is data dependent. But the graphic shows that it’s important to track FOMC member comments because not everyone interprets the data the same way.
Subscribe to our RSS feed to receive notifications when the graphic is updated.