Fed has little about which to be patient

Washington

THE Federal Reserve's lack of patience may be tested before long. Its monetary policy committee now anticipates that domestic gross domestic product (GDP) will grow by less than 3 per cent a year indefinitely. That has curbed their expectations - and the market's - for higher interest rates accordingly. The steady and narrow consensus at the Fed, however, could easily prove misplaced.

The committee dropped the word "patient" from its policy statement, indicating that it is finally ready to consider raising the federal funds rate, the all-important overnight lending rate that has been hovering near zero for six years. The optimistic change in language belies a less bold outlook.