FOMC Meeting date: LAST MEETING: November 16th.
1999
MEETING OUTCOME:
The
Federal Reserve Bank WILL raise both the Federal
Funds & Discount rates to tame a labor
pressed economy.
MEETING AGENDA:
The
Federal Reserve Bank discusses Discount and/or
Federal Funds rates hike.
BEIGE BOOK (12 DISTRICTS) REPORT OF NOVEMBER
3RD. 1999
Economy
continues to show strength nationwide, but
lower in some districts.
Labor
shortage is nationwide, but little labor related
inflation pressures.
Third
district is worried about high demand for
liquidity (currency) as Y2K approaches.
Midwestern
"plains" districts have the most
wage pressures.
Western
districts had high manufacturing increases,
but lower Technology related increases due
to Y2K fears.
Mid-Atlantic
(5th. District) had low coastal real estate
demand due to the hurricane season. However,
real estate demand was strong in the inland
parts.
Southeastern
district (6th. District) had a very weak construction
period.
New
England districts are optimistic about the
coming holiday season, despite a tight labor
market.
HUMPHREYS-HAWKINS (CONGRESSIONAL) REPORT
OF JULY 22nd. 1999
Economy
near Ninth year of economic growth.
Lowest
unemployment rate since the 70's.
Inflationary
pressures can be eased by foreign markets
recovery and growth.
Year
2000 Nominal GDP projected at 4.2
Year
2000 Real GDP projected at 2.1
Year
2000 CPI projected at 2.4
RECENT ECONOMIC DATA RELEASES:
Retail
sales were flat in October - A good sign of
an economic slow down.
The
Unit Labor cost had the smallest increase
in a year. However, productivity rose over
4% in the same period. This is a clear sign
that wage inflation is also under control
already.
The
Producer Price Index (PPI) was low. However,
the core PPI was slightly higher than anticipated.
U.S.
Unemployment rate the lowest since 1970, but
little wage pressure on inflation noticed.
The
employment cost index is lower than anticipated.
GDP
grew modestly, but the GDP deflator was lower
than the previous quarter's.
Consumer
Confidence has been low in the previous four
months.
THE GENERAL CONSENSUS ABOUT COMING MEETING:
We
feel the Federal reserve WILL NOT raise interest
rates. The general consensus out there is
statistically 50-50.
The
Beige book report, or other economic reports
show no conclusive inflationary pressure.
Too
much is riding on this meeting for the feds
to change course; A rate increase can panic
consumers and investors in a "double
wammy" quarter - holiday season and Y2K.
The last thing central bankers want to do
is create an economic panic.
FOMC Meeting date: LAST MEETING: October 5th.
1999
MEETING OUTCOME:
The
Federal Reserve Bank WILL NOT raise any interest
rates for now.
BEIGE BOOK (12 DISTRICTS) REPORT OF SEPTEMBER
22ND. 1999
Moderate-to-brisk
economic growth nationwide.
Midwestern
districts had strong steel & metal demand.
Loan
demand is still very strong.
Atlanta,
Boston, and San Francisco(12th.) districts
had highest industrial equipments demand increase.
California
(12th. District) had highest increase for
electronics, wood, and chemicals due to increased
demand from Asia.
Dallas
and Kansas City districts are having an upswing
in oil and natural gas related sectors, as
oil prices continue to rise.
Midwestern
and Richmond districts have been affected
by the crop and livestock drought.
Atlanta
and Chicago districts already have weaker
home demand.
HUMPHREYS-HAWKINS (CONGRESSIONAL) REPORT
OF JULY 22nd. 1999
Economy
near Ninth year of economic growth.
Lowest
unemployment rate since the 70's.
Inflationary
pressures can be eased by foreign markets
recovery and growth.
Year
2000 Nominal GDP projected at 4.2
Year
2000 Real GDP projected at 2.1
Year
2000 CPI projected at 2.4
RECENT ECONOMIC DATA RELEASES:
U.S.
GDP rose a lower-than-expected 1.6% in second
quarter.
U.S.
Durable goods prices rose 0.9%, as opposed
analysts expectation of a 0.9% drop.
U.S.
M2 money supply grew during the period.
U.S.
Trade deficit grew for the period.
THE GENERAL CONSENSUS ABOUT COMING MEETING:
The
Federal Reserve will not raise interest rates.
That is the most popular consensus.
The
Financial markets and other sectors of the
economy have corrected enough to justify a
no action.
The
benign economic data doesn't favor a rate
increase.
Treasury
Secretary Summer's "strong dollar"
stand will be counterproductive with a rate
hike.
Most
analysts feel the feds won't want to send
the wrong signals to markets (and world) already
jittery about Y2K.
LAST MEETING: August 24th. 1999
MEETING OUTCOME:
Raised
the Fed. Funds rate (loans between banks)
by 25 bases points (0.25).
Raised
the Fed. Discount rate (Feds loans to banks)
by 25 bases points (0.25).
Chances
of more rate increases this year left open.
<--related data for August 24th. meeting below-->
MAJOR MEETING AGENDA:
Raising
of Federal Funds (interbank loan) Rate.
BEIGE BOOK (12 DISTRICTS) REPORT OF AUGUST
11th. 1999
Strong
economy nationwide.
Intense
Loan Competition.
High
demand for non residential real estate.
California
(12th. District) had highest housing starts.
HUMPHREYS-HAWKINS (CONGRESSIONAL) REPORT
OF JULY 22nd. 1999
Economy
near Ninth year of economic growth.
Lowest
unemployment rate since the 70's.
Inflationary
pressures can be eased by foreign markets
recovery and growth.
Year
2000 Nominal GDP projected at 4.2
Year
2000 Real GDP projected at 2.1
Year
2000 CPI projected at 2.4
RECENT ECONOMIC DATA RELEASES:
U.S.
overall CPI grew a modest 0.3 percent.
U.S.
Larger-than-expected trade deficit.
THE GENERAL CONSENSUS ABOUT COMING MEETING:
The
Federal Reserve will raise interest rates.
The
interest rate will be raised about 25 bases
points (.25).
This
might be the last interest rate hike this
year.
