Yellen: ‘We’ll Be Watching Job Market Carefully'

“Our policy is not on a preset course,” Yellen said Wednesday.

WASHINGTON, DC—Economists both within and outside of the commercial real estate sector had expected the Federal Reserve to delay action on an interest rate increase at its June meeting, and their expectations were met Wednesday. In a Research Brief last week, for example, Marcus & Millichap pointed to weaker-than-anticipated May job growth as providing “an opening to withhold a rate hike this month and delay action until it believes economic momentum supports a hike. The central bank will also have more time to digest the effects of a possible exit from the European Union by Britain, which will be determined by popular vote on June 23, due to the potential for volatility and uncertainty.”

The possibility of a “Brexit” later this month, and its potential effects on global financial markets, figured in the Federal Open Market Committee’s decision to maintain the the target range for the federal funds rate at ¼% to ½%, Fed Chairman Janet Yellen said Wednesday. It’s the fourth consecutive FOMC meeting at which interest rates were left unchanged after the group’s December 2015 decision to begin normalizing rates; in fact, six committee members expect no more than a single interest rate increase this year.