Here's what 9 Wall Street gurus think about the Fed's rate hike

The Federal Reserve on Wednesday raised its benchmark interest rate as widely expected.  The central bank's Federal Open Market Committee voted after a two-day meeting to increase the fed funds rate by 25 basis points to a range of  1.25%-1.50%. The Chicago Fed's Charles Evans and Minneapolis Fed's Neel Kashkari voted against the decision. 

NEW DELHI: The US Federal Reserve released the minutes of the December 13-14 policy review on Wednesday, which hinted at a higher probability of rate hikes in the coming months. There are also signs that the US dollar might strengthen further going forward. The minutes revealed what the Fed policy makers were thinking before raising policy rate by 25 basis points at the much-anticipated December review. Here are a couple of takeaways from the Fed minutes.

Federal Reserve officials, meeting for the last time under Chair Janet Yellen, left borrowing costs unchanged while adding emphasis to their plan for more hikes, setting the stage for an increase in March under her successor Jerome Powell. “The committee expects that economic conditions will evolve in a manner that will warrant further gradual increases in the federal funds rate,” the policy-setting Federal Open Market Committee said in a statement Wednesday in Washington, adding the word “further” twice to previous language.

As expected, the US Federal Reserve on Wednesday hiked interest rates by 25 basis points for the third time this year. It also projected three more rate hikes for 2018. As the rate hike was already built into the markets, global market reacted mildly to the Fed’s policy review, with Asian markets trading mixed in morning trade. Back home, benchmark equity indices BSE Sensex and NSE Nifty opened on a firm note on Thursday after Fed’s decision. The BSE Sensex opened 61 points up at 33083.63, while the NSE Nifty index was up 36 points higher at 10,229.30.

In raising its target interest rate by 25 basis points on Wednesday, the U.S. Federal Reserve hit something of a milestone: it has now implemented a full percentage point of increases since December 2015, when it hiked for the first time since the global recession. But like the Dow at 2,000 or the 100-day mark in presidencies, this week’s Fed milestone is relatively meaningless. In central bank policy announcements, as in political leaders and markets, the only thing that really matters is what’s next.

When in doubt about the Fed's policies, or their implementation, always go right to the source of Fed ideas, Goldman Sachs, which moments ago published its post-mortem on today's FOMC statement, noting that the "post-meeting statement included modest upgrades to its description of growth but acknowledged the moderation in job growth and the decline in inflation, and it continued to describe risks to the outlook as “roughly balanced.”

Alex Brandon/APFederal Reserve Board Chair Janet Yellen's press conference after Wednesday's interest rate hike was packed with questions about the future under President-elect Donald Trump. On the campaign trail, Trump was critical of Yellen and her monetary policy approach. He had said she kept interest rates low as a political favor to President Barack Obama.

WASHINGTON: The US Federal Reserve left interest rates unchanged on Wednesday but strongly signaled it could still tighten monetary policy by the end of this year as the labor market improved further. The Fed said US economic activity had picked up and job gains were "solid" in recent months. "The case for an increase in the federal funds rate has strengthened," the US central bank said in a statement following a two-day policy meeting.