At its March 21 meeting, the Federal Open Market Committee raised the federal funds rate target 25 basis points (bp) to 6.0%. This was the second consecutive meeting to result in a 25 bp increase, and the fifth such increase since last June. The FOMC’s press release described conditions as “essentially the same as when the Committee met in February,” but it continued to stress that without further policy action, “increases in demand will continue to exceed the growth in potential supply, which could foster inflationary imbalances that would undermine the economy’s record economic expansion.” Separately, the Board of Governors approved recommendations by the Reserve Banks’ boards of directors to raise the discount rate 25 bp.
Suggested citation: "Monetary Policy," Federal Reserve Bank of Cleveland, Economic Trends, no. 00-04, pp. 02-03, 04.01.2000.