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We previously wrote a short post asking "Does the Fed have the guts to do it?".
Well, today the Fed did raise rates, after keeping their target at essentially zero for seven years.
Economist Brian Wesbury, whose interpretation of economic events has been cited many times on the pages of this blog through the years, provides some worthwhile discussion of today's Fed decision here.
He notes that, although many commentators are describing the Fed statement that accompanied the decision as "dovish" in nature, the points made in the Fed statement are actually "mildly hawkish," including the comments regarding employment and "utilization" data, and the statement that -- even with this small rate hike -- monetary policy remains "accommodative."
Brian Wesbury concludes by saying that:
Today's rate hike isn't going to hurt the economy; it will help the economy by signaling the eventual end to a policy that has distorted economic decisions for the past several years.
We agree.
Read the entire article by economist Brian Wesbury, as well as the entire statement from the Federal Open Market Committee, here.