Central bankers last provided their forecasts in December. The Fed today released the policy makers’ quarterly economic forecasts at the same time as the statement. Previously, on days Bernanke held a press conference, the central bank released the statement at about 12:30 p.m. and the FOMC forecasts an hour and a half later. From now on, both will be released at 2 p.m.
Bernanke will hold a press conference at 2:30 p.m. in Washington to further explain the Fed’s statement and forecasts.
Forty-four of 45 economists in a Bloomberg survey March 13- 18 said the pace of purchases wouldn’t be reduced at today’s meeting. Fifty-eight% of economists in the survey said officials won’t reduce buying until the fourth quarter or later, while 55% said they expect the Fed to end its quantitative easing entirely in the first half of next year.
Since the Fed last met in January, stocks have climbed to new highs, with the Dow Jones Industrial Average exceeding its prior peak from October 2007. The index, which has gained more than 10% this year, remains near its record close at 14,539.14 on March 14. The yield on the benchmark 10-year Treasury advanced to an 11-month high of 2.06% on March 11.
Gains in house prices and construction will put more Americans to work this year, according to Bluford Putnam, chief economist at CME Group Inc., the Chicago-based owner of the world’s largest futures market, and a former economist at the Federal Reserve Bank of New York.
“This housing rebound is for real,” Putnam said before the FOMC statement. “We’re getting a decent number of housing starts, and homebuilder stocks have all spent last year recovering. For the first time in 2013 we can really count on the housing sector to create some jobs.”
Housing starts rose 0.8% in February to 917,000 homes at an annual rate, while building permits advanced 4.6% to 946,000, the highest level in almost five years, the Commerce Department said yesterday.