The Fed Is Ready To Take Action In October.

The two largest policy objective of the Federal Reserve is to maximize employment and stabilize inflation by 2%. The unemployment rate dropped to 5.1% in August. Williams said he expects the United States to reach full employment by the end of this year or early 2016. Inflation is still in the doldrums. The Fed's inflation index shows that current inflation is only 0.3%.

In the statement, the Fed said: "the recent global economic and financial progress will restrict economic activity and may further reduce inflation in the short term."

On Saturday, a number of Federal Reserve officials spoke in support of the Fed's interest rate increase by the end of the year. This is different from many traders' expectations. Many traders expect the US Federal Reserve to postpone its debut for the first time. Increase interest Until 2016.

On Thursday, when the Federal Reserve decided not to raise interest rates, San Francisco Fed chairman John Williams and Saint Louis Fed chairman James Bullar spoke on Saturday to support the Fed's interest rate hike in 2015.

In a speech Saturday, Wiliiams, chairman of the San Francisco fed, said he thought it would be appropriate to raise interest rates by the end of the year. "In view of the progress we have made, we will continue to approach our goals," Williams said. I think the next step is to raise interest rates step by step, probably starting later this year.

According to the Fed's meeting materials, 13 of the 17 policymakers still expect the fed to raise interest rates by the end of 2015. FOMC will be held on 27-28 October and 15-16 December.

However, according to federal funds futures Price Traders think the Fed is more likely to postpone raising interest rates until 2016.

According to MarketWatch's quoted CME FedWathch data, market traders believe that the possibility of raising interest rates in January next year is 52%, which is later than a prediction made before the Federal Reserve decided to keep interest rates unchanged, according to the Wall Street information website. The Fed plans to hold a meeting in January next year, 26-27.

Bullard, chairman of the Saint Louis fed, said that maintaining interest rates unchanged "increased rather than reduced global macroeconomic uncertainty." Bullard says, FOMC The target has basically reached, but the committee's policy setting is still in a state of emergency.

Bullard said that even after a small increase in interest rates, monetary policy is still very loose and will continue to push inflation. Williams said that despite the strong dollar and falling oil prices in the past year, these factors should be temporary. He expects inflation to reach 2% in the next two years.

Both Williams and Bullard say that October is the possible time point for the fed to raise interest rates. Although there is not much economic data between the current meeting with October, a report on non farm employment and a CPI report.

"There is not much economic data," Bullard said. But if circumstances permit, the Fed is ready to take action in October.