Federal Reserve Chair Janet Yellen, attends the International Monetary and Financial Committee (IMFC) at the World Bank-International Monetary Fund annual meetings in Washington, Saturday, April 18, 2015. ( AP Photo/Jose Luis Magana)
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Janet Yellen wants you to know that while the era of zero rates may be drawing to a close, money will stay cheap for a long time to come.Policymakers have ruled out an increase at the next meeting of the Federal Open Market Committee, April 28-29 .The proportion of economists predicting the Fed will wait until September to raise rates rose to 70 percent in an April 3-9 survey from 32 percent last month.Officials in March predicted the funds rate would be 1.875 percent by the end of the 2016 and 3.125 percent by the end of 2017 .According to euro dollar interest rate futures, rates will have barely moved above 1 percent by the end of 2016 and will still be under 2 percent 12 months later.At 5.5 percent, unemployment is still above the long-run rate of 5 percent to 5.2 percent projected by Fed officials.Signaling a 2015 rise has helped Yellen forge unanimous support for her exit plan, appeasing FOMC members who, like Lacker, worry that keeping rates low for too long risks spurring asset-price bubbles.
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