Even after five years of steady economic growth, Federal Reserve Chair Janet Yellen is likely to raise interest rates only gradually between 2015 and 2017 as inflation remains muted, according to a Bloomberg survey of economists.
Fifty-six percent of 61 economists said the median of policy makers’ forecasts for the benchmark interest rate at the end of 2017 will be below their median estimate for the longer-run rate. Forty-one percent said the rate would be at the longer-run median. The survey was conducted Sept. 11-15.
Policy makers, who start a two-day meeting today, are considering how much progress toward their goals of full employment and stable inflation would be needed to prompt the first rate increase since 2006. They will outline their outlook for the economy in quarterly projections for growth, unemployment (USURTOT), inflation and the benchmark federal funds rate.