Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : LastShadow's Position Trading -- Ignore unavailable to you. Want to Upgrade?

To: AlienTech who wrote (14507)	5/18/1999 2:25:00 PM
From: LastShadow	Respond to of 43080

Fed Moves to a Bias Toward Tightening By David A. Gaffen Staff Reporter 5/18/99 2:11 PM ET The Federal Open Market Committee did not raise interest rates but instead adopted a bias that indicates the committee is considering tightening interest rates in the future. The Federal Reserve policy panel left the short term lending rate unchanged at 4.75% and kept the discount rate at 4.50%. FOMC members apparently believe there are enough signs of inflation pressures to justify the change in directive. While wage and price-related pressures have not increased steadily, last Friday's April Consumer Price Index rose at its fastest rate in nine years, and anecdotal evidence in manufacturing surveys is pointing toward recovery in that sector. Yields on Treasury maturities have risen sharply in the past few weeks as participants became increasingly concerned over rising inflation. Strategists said the shift in bias has the effect of making the Fed appear vigilant without actually having to change monetary policy. The funds rate has been 4.75% since November, when the Fed cut rates for the third time in seven weeks. The fed funds rate is the overnight interbank lending rate. The discount rate is the rate for loans from the Fed to banks. The FOMC will convene its fourth meeting of 1999 on June 29 to again decide whether to change rates.