Fed rate hikes still on table despite market turmoil

FOMC takes more dovish tone

The Federal Reserve has indicated it may still go ahead with further rate hikes this year, contrary to industry expectations.

In its monthly meeting, the Federal Open Market Committee took a more cautious tone than in December. It reduced its target for full employment from 5% to 4.9% and said it expected inflation to remain low in the near term. The low inflation was blamed on the fall in energy prices but the Fed said this was "transitory" and that inflation should still rise to its 2% target over the medium term. It was unlikely the committee would have decided to raise rates at this meeting, just one month after the first rate hike since 2006 and in the wake of a volatile start in 2016. The first w...