And the Fed Said…

🏦 The Federal Reserve held short-term interest rates near zero following the conclusion of its two-day meeting yesterday, but signaled it intends to increase rates starting in mid-March to combat rising inflation.

• It would be the first such increase since December 2018. Economists project the central bank will raise short-term interest rates by a quarter-percentage point at least four times this year.
• The Fed cut short-term rates to near zero and started buying bonds to lower long-term rates in early 2020 as the pandemic began to impact the US economy.
• The central bank previously said it'll wait to raise short-term rates until its bond-buying measures wind down entirely in March.
• Officials spent much of this week’s meeting debating how and when to shrink its $9 trillion balance sheet, which has nearly doubled since the pandemic began.

+Market update: Stocks fell slightly following the Fed’s announcement to close at roughly even for the day.