The Federal Open Market Committee Held Their Benchmark at Historical Low Target Range 0.0-0.25%

The Federal Open Market Committee met again to decide on holding their benchmark at their historical range of 0.0-0.25%, concentrating on the purchase of long-term debt in order to fight Deflation! The decision came to beat markets expectations where some analysts wanted narrow down the benchmark to 0.13%.

The decision followed the unexpected first quarter contraction of 6.1% which fell short of markets projections at -4.7%; yet the first quarter growth reading improved slightly from the final fourth quarter reading standing at -6.3%. Even with this contraction one of Obama’s economic team, Paul Volcker said that there is no need for another fiscal stimulus because the contraction is “leveling off”. However, I happen to disagree with him, as the ongoing Credit Crisis is still pressuring the economy in addition to the weakness in the financial sector, where we expect more gloomy news on the fourth of May when the results of the Stress Test are released.

Ecpulse

disclaimer: The content of ecPulse.com and any page in the website contain information for investors/traders and is not a recommendation to buy or sell currencies, stocks, gold, silver & energies, nor an offer to buy or sell currencies, stocks, gold, silver & energies. The information provided reflects the writers' opinions that deemed reliable but is not guaranteed as to accuracy or completeness. ecPulse is not liable for any losses or damages, monetary or otherwise that result. I recommend that anyone trades currencies, stocks, gold, silver & energies should do so with caution and consult with a broker before doing so. Prior performance may not be indicative of future performance. Currencies, stocks gold, silver &energies presented should be considered speculative with a high degree of volatility and risk