The Federal Reserve indicated it will continue to raise interest rates despite muted inflation levels, which they believe will be temporary and likely to rise over the long run to their targeted 2% level, reports Jeff Cox for CNBC.
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The Fed raised its benchmark rate target a quarter point at the recent meeting and outlined plans to cut its $4.5 trillion balance sheet of bond holdings.
Fed officials also warned about greater risk in the equities market, especially in a prolonged bullish environment.
FOMC members “suggested that increased risk tolerance among investors might be contributing to elevated asset prices more broadly; a few participants expressed concern that subdued market volatility, coupled with a low equity premium, could lead to a buildup of risks to financial stability.”
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