Fed Raises Rates for Second Time This Year

The video discusses the Federal Reserve's interest rate changes, projecting a 25 basis point increase from 1.75% to 2% in 2018, with further increases expected in 2019 and 2020. The long-term rate remains at 2.9%. Unemployment is projected to decrease to 3.6% in 2018 and 3.5% in 2019 and 2020. PCE inflation is expected to overshoot earlier projections. The Fed has dropped forward guidance on maintaining an accommodative stance, and there is a 20 basis point increase in the interest on excess reserves rate, which is less than the usual 25 basis points.

What was the new target range for interest rates after the 25 basis point increase?

• 1.5% to 1.75%

• 2.25% to 2.5%

• 1.75% to 2%

• 2% to 2.25%

How many rate increases are projected for 2019?

• Four

• One

• Two

• Three

What is the projected unemployment rate for 2018?

• 3.7%

• 3.5%

• 3.8%

• 3.6%

When was the PCE inflation overshoot initially expected?

• 2018

• 2019

• 2020

• 2021

What was the increase in the interest on excess reserves rate?

• 25 basis points

• 20 basis points

• 30 basis points

• 15 basis points