Now It's the Fed That Appears to Be Moving Slowly

It seems as if the Federal Reserve's interest rate is the one that is stuck.

The Fed on Wednesday left its benchmark overnight lending rate in a 1.25 percent to 1.5 percent target range. Chair Janet Yellen, in her last rate-setting meeting, went out quietly, or perhaps true to form. Much of the commentary around her exit has been praise that she resisted raising rates further even as critics said they needed to go higher. More important, despite what President Donald Trump calls the largest tax cut in history, and record highs for the equity markets, the Fed gave only a conflicting indication about how fast it will raise rates this year. As Bloomberg News noted, the Fed added "further" twice to its previous language about future rate increases in its statement. But the Fed also repeated language that said “near-term risks to the economic outlook appear roughly balanced.” Many had thought the Fed might shift the statement to say that inflation and too much growth might be more of a risk than the opposite.