8 Apr, 2015
Loan Preparation
Mortgage Rates Comments Off on Federal Reserve May Have Reason To Raise Interest Rates

Federal Reserve policy makers have another reason to delay an interest-rate increase after a weak March payroll report confirmed a first-quarter slowdown in the U.S. economy. The question is whether that’s reason enough. The sputtering U.S. economy created just 126,000 jobs versus an expected 245,000 in March as bad weather, weak consumer spending, slowing U.S. manufacturing growth, and flailing corporate profits resulted in the worst report since 2012. The weaker data contrast with 12 straight months of 200,000-plus monthly gains. The Fed is watching for the economy to reach or approach full employment and generate higher inflation before raising interest rates from near zero. Fed Chair Janet Yellen and her colleagues last month opened the door to an increase as soon as June, while also suggesting in forecasts that September may be a more likely time to begin tightening. It’s difficult to tell how Fed officials will react to a single month of weak jobs data.