Good news is bad news as Fed watches for hot US economic data

IN THE world of the US Federal Reserve, good news is now officially bad news. Investors, however, may be completely fine with that.

The Fed left benchmark interest rates unchanged for the second straight policy meeting on Wednesday (Nov 1), with the US central bank’s rate-setting group agreeing – as expected – to keep the key federal funds rate in a target range of between 5.3 per cent and 5.5 per cent.

Fed chairman Jerome Powell issued a stern warning, however, that signs of surprising strength in the US economy is likely to force the resumption of the Fed’s inflation fight and another rate increase sooner rather than later.