WASHINGTON — Federal Reserve policymakers have slightly lowered their projections for short-term interest rates over the next three years, a sign that policymakers may move slowly after their first rate increase in seven years.
More Fed policymakers expect the short-term rate will be 1.38 per cent or below at the end of 2016 than in previous projections in September. And they forecast the rate will be 2.38 per cent at the end of 2017 and 3.25 per cent at the end of 2018, both a quarter-point lower than in September.
Still, the Fed's forecasts for the U.S. economy and interest rates have proven too optimistic for most of the recovery from the Great Recession. A year ago, for example, policymakers projected the Fed's short-term rate would be much higher by the end of next year.
Christopher S. Rugaber, The Associated Press