Federal Reserve: No rate hike for July

In the wake of the U.S. Federal Reserve’s two-day July meeting on Wednesday, they released a statement indicating there would be no rate hike in the interest rate this month.

The released statement usually contains only incremental changes from each meeting, and this was no different. However, Wall Street analysts typically track the small changes to see where the feds policies are heading.

The Wall Street Journal’s Fed Statement Tracker shows only minor changes from he June meeting. The changes do seem to be optimistic toward the economy with the statement highlighting a growing labor market and shrinking unemployment.

Many analysts point to the central bank hinting at a rate increase that could come at any time, however, the interest rate has remained flat since June 2006. The only changes have been some  incremental fluttering between 0 and .25 percent.

It is likely that the Fed is waiting for the September meeting to make any changes. At this point they will have key inflation and GDP reports that will give a more realistic view of the markets and economy.

Fed Chair Janet Yellen has indicated that she would like to make a change this year, and feels like it would be appropriate as long as there was not a negative incident harming the economy.

With the U.S. sitting at a nearly full employment of five percent, and inflation inching ever closer to the Feds targeted two percent, it seems like the central bank will likely increase the interest rate any time now.

[RT]