Market Looking Positive Post Fed Meeting – Economic Highlights

The Fed indicated that they will raise interest rates a bit higher relative to their prior projections when they reach that stage. But they were able to more than offset the effect this seemingly negative new information by modestly lowering their estimate of long-term or ‘normal’ interest rates in the future. Yellen didn’t come across as overly concerned about inflation, with Tuesday’s hotter looking CPI read getting no nod at all. There were no ‘irrational exuberance’ comments either while discussing the lack of volatility in the markets.

With respect the economy, the FOMC lowered its GDP growth estimate for this year to account for the sub-par growth pace of Q1, which some estimates put at having dropped almost double the first revised tally. Growth this year is now expected to be in the +2.1% to +2.3% range, down from the March level of +2.8% to +3%. However, the official post-meeting statement characterized the growth picture having ‘rebounded in recent months’, meaning GDP growth exceeding +3% from next year onwards. This brings the Fed’s growth outlook in-line with the recently lowered projections from the World Bank and IMF.

In corporate news this morning, Pier 1 Imports (PIR) came out with weak quarterly results and guidance, while BlackBerry (BBRY) posted positive results. Oracle (ORCL) will be releasing results after the close today.