Singapore Stock Market News

Economic Updates - Fed sticks to script

StockFanatic
Publish date: Thu, 21 Mar 2013, 12:16 PM
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We are not surprised by the Fed's decision to maintain its highly-accommodative monetary policy despite its upbeat assessment of the economy. The Fed downplays concerns that its ultra-loose policy has spawned asset bubbles and defends its decisions on the basis of the need to provide growth stimulus with little risk to inflation.

With its two thresholds (unemployment and inflation) improving, albeit still far behind the Fed's targets, we think a swift change in policy or premature withdrawal of liquidity is unlikely in the near term. We think forward policy rates and the monetary course will be data-dependent.
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