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Representative David Schweikert - Vice Chairman

June FOMC Review: “The Economy is in Great Shape”

June FOMC Review: “The Economy is in Great Shape”

FOMC Review Snapshot

  • The Fed raised its key policy rate, the interest on excess reserves (IOER) rate, to 1.95% as expected.
  • Fed Chairman Jay Powell noted in his press conference that “the economy is in great shape.”
  • Thus, the IOER rate will likely be raised two more times this year instead of the previously expected one.

Fed Chair Jay Powell noted “the economy is doing very well” and that “business investment continues to grow strongly” in his press conference. This has enabled the Fed to only gradually raise interest rates and allow the economy’s improved trajectory to continue unimpeded. This is notable as the Tax Cuts and Jobs Act (TCJA) is often mischaracterized as possibly causing unsustainable economic growth and accelerating inflation, which would call for more aggressive Fed interest rate hikes. In reality, TCJA is designed to sustainably raise economic growth without stoking inflation.

Click here for the Joint Economic Committee's Full June FOMC Review!

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