The stock markets continued to trade without directional movement as the Fed issued its first interest rate hike of the year and sounded very hawkish about economic growth forecasts for 2018 and 2019.
Market participants were expecting the Fed to hike rates to 1.75% and they were more interested in knowing if we will see more than three rate hikes in 2018 altogether. While the Federal Open Market Committee (FOMC) statement did not explicitly mention additional rate hikes this year, policymakers did raise their projections for GDP growth in 2018 to 2.7%.
In addition, the housing market made a comeback as existing home sales numbers rebounded after declining for two consecutive months. However, the shortage of low-end housing units continued to bog down the housing market.
In the end, the FOMC statement did not sound any alarm bells as yet, but unless we see strong consumer confidence numbers next week, the stock markets will probably continue to trade sideways for the time being.
Be sure to check out our previous week’s edition here, in which investors were busy following the political turmoil in Washington.
