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On December 14, the Federal Open Market Committee (FOMC) announced that it had voted unanimously to raise the target range for the federal funds rate by 25 basis points to 0.5 to 0.75 percent – marking only the second rate hike since the financial crisis. According to a statement released by the FOMC, Committee members attributed the increase to consistent economic growth, in particular strong job gains, throughout 2016. Projections released yesterday include accelerated growth over the next few years, which suggest a series of additional rate hikes throughout 2017. The Committee continued to stress, however, that future rate hikes will “depend on the economic outlook as informed by incoming data.” A transcript of Fed Chair Yellen’s press conference opening remarks can be found here.
As part of implementing the rate hike, the Federal Reserve Bank of New York, effective December 15, will conduct overnight reverse repurchase operations at an offering rate of 0.50 percent, with a per-counterparty limit of $30 billion per day. The regional bank’s Open Market Trading Desk estimates approximately $2 trillion of Treasury securities in its account will be available for these operations.
In a press release published on November 2, the Fed announced its decision to: (i) leave unchanged the interest rate paid on required and excess reserve balances at 0.50 percent; and (ii) take no action to change the discount rate (the primary credit rate), which remains at 1.00 percent. This decision came in response to a monetary policy statement released earlier Wednesday by the Federal Open Market Committee (FOMC), following its vote to “maintain the target range for the federal funds rate at 1/4 to 1/2 percent” for the seventh consecutive meeting. More information regarding open market operations may be found on the Federal Reserve Bank of New York's website.
- Jonice Gray Tucker to discuss “How the new administration sets the tone for 2021” at the American Conference Institute Legal, Regulatory and Compliance Forum on Fintech & Emerging Payment Systems
- Sherry-Maria Safchuk to discuss UDAAP in consumer finance at an American Bar Association webinar
- Jeffrey P. Naimon to discuss "What to expect: The new administration and regulatory changes" at the Mortgage Bankers Association Legal Issues and Regulatory Compliance Conference
- Jonice Gray Tucker to discuss “The future of fair lending” at the Mortgage Bankers Association Legal Issues and Regulatory Compliance Conference
- Steven R. vonBerg to discuss "LO comp challenges" at the Mortgage Bankers Association Legal Issues and Regulatory Compliance Conference
- Michelle L. Rogers to discuss "Major litigation" at the Mortgage Bankers Association Legal Issues and Regulatory Compliance Conference
- Michelle L. Rogers to discuss “The False Claims Act today” at the Federal Bar Association Qui Tam Section Roundtable