At its May 20 meeting, the Federal Open Market Committee (FOMC) decided to maintain it's existing degree of pressure on the federal funds rate, expecting it to remain around 5.5%. The rate was last increase 25 basis points to it's current level at the March 25 meeting, after staying unchanged for nearly 14 months. Financial markets, as represented by the federal funds futures market, had been anticipating another rate increase of 25 points by July, and many market participants had expected an uptick to be announced at the FOMC's May meeting.
Suggested citation: “Monetary Policy,” Federal Reserve Bank of Cleveland, Economic Trends, no. 97-06, pp. 02-04, 06.01.1997.