Over the past week, it was as if all the central banks had conspired to hold their monthly meetings. Besides the United States, similar meetings were held in China, Europe, Britain, Switzerland, etc. The tightening of monetary policy was only in the US and China, where repo interest was increased by 0,05 points.
This was the last meeting of the Fed under the leadership of Janet Yellen. Perhaps that is precisely why she was much more vocal in front of the press at the end of the session. She commented even blockchain currencies by sharing that the central bank does not plan to take moves related to the regulation of crypto money, it has the obligation and will regulate its supervised entities.
But it also clarified that economists are not always aware when the values are too high and in itself the fact that companies’ estimates are high does not mean that stocks are overrated.
In addition, it has voiced confidence in its successor Jerome Powell, who believes that the current policy of a gradual increase in interest rates will continue.
Janet Yellen said that as a result of tax reform, members of the Fed expect an increase in consumption and growth in business costs. The Fed predicts three interest rates hikes in 2018 as well as in 2019 until interest rates reach 2.8%.
Investors have taken very well the words of the President of the Fed. Moreover, tax reform will soon be a reality, with President Trump likely to sign it before the holidays.
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