Federal Reserve policy makers left open the possibility of raising interest rates in the second half of this year by playing down the significance of the economy’s slowdown to a near-standstill in the first quarter.
In a statement issued Wednesday after a two-day meeting, Chair Janet Yellen and her colleagues blamed the winter slump partly on “transitory factors” and reiterated their belief that growth will pick up to a “moderate pace.”
“They were straightforward in acknowledging the weakness in the first quarter but avoided suggesting that ruled out interest-rate increases going forward,” said Lou Crandall, chief economist at Wrightson ICAP LLC in Jersey City, New Jersey.
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