Reserve Adjustment: Rate Hike and Interest Rates

reserve adjustment: When the Fed announced its second rate hike in 10 years earlier this month, it penciled in three increases for 2017, according to Market Watch. The Chicago Fed national activity index fell to negative 0.27 in November from an upwardly revised negative 0.05 in October. The report helps fuel the argument among some economists that any Federal Reserve adjustment to interest rates in 2017 will be moderate absent signs of inflationary economic growth. The index's three-month moving average, which tends to offer a clearer picture of the trend in economic activity than the monthly reading alone, improved to negative 0.14 in November from an upwardly revised negative 0.20 in October. A reading of -0.27 still suggests the U.S. economy expanded at a below-average rate and is easing its foot off the accelerator after a stronger performance in early summer, said Steven Shields, economist with Moody's Economy. The index is a weighted average of 85 economic indicators, designed so that zero represents trend growth and a three-month average below negative 0.70 suggests a recession has begun. (news.financializer.com). As reported in the news.