Signaling their confidence that the economy is on track for growth strong enough to keep reducing unemployment, Federal Reserve officials nudged up their projections for short-term interest rates in 2015 and 2016, though they slightly reduced their outlook for rates in the longer-run.
In a statement released after the Fed’s latest two-day policy meeting and a news conference by Chairwoman Janet Yellen, the central bank underlined the economy’s rebound in the past few weeks after output shrank in the first quarter.
That contraction forced officials—as part of their quarterly projections for growth, employment, inflation and interest rates—to sharply lower their expectations for growth this year. But they stuck to an optimistic outlook for the next two years and projected a path of further declines in unemployment.
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