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Wednesday, March 15, 2006Which Way Will the Fed Go?From Reuters: ATLANTA, March 15 (Reuters) - The Federal Reserve has raised U.S. interest rates to a level at which it is hard to predict where borrowing costs will go from here, a top Fed official said on Wednesday. "It was a lot easier for the last 20 months to know which way we were going and even the pace at which we were going," Guynn said in answer to a question after speaking at an exhibit opening. "I think we're about at a point now, I say about, a point where there are uncertainties on both sides." "I really think we're at a point ... (of) not being able to say exactly what's around the next corner... as opposed to being able to say exactly what the next couple of steps on policy might be," he added. The major indices close to all time highs, oil inventories up and gas prices at near-term lows, low unemployment with looming wage pressures coupled with a increasingly wary housing market and waning foreign demand means that the fed may signal that they are done raising rates, for now, and indeed they may be. What will the markets make of all this...? Bullish run into the summer!
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