The Federal Reserve raised interest rates again today. The Fed funds rate inched higher by 25 basis points to 3.0%, only just below inflation’s pace, measured by the consumer price index, which advanced by 3.1% for the year through March. Twelve months previous, CPI was rising by 1.7% and the Fed funds rate was 1.0%. In short, the real (inflation-adjusted) Fed funds rate is close to being neutral, as opposed to negative, for the first time since 2002.
Monthly Archives: May 2005
TOUGH GUYS, TOUGH TALK & TOUGH CHOICES
Robert Portman, the newly minted U.S. trade representative, promises to get tough with China. Red ink is the reason.
“Part of [the U.S. trade] deficit is because the Chinese do not always play by the rules,” he told the Senate Finance Committee via Bloomberg News a week before he received confirmation for ascension to the trade post from his former life as a Republican congressman from Ohio.