Economists' Take on Yesterday's FOMC Meeting

The Fed is bullish on growth, nervous on inflation, and believes policy is still “accommodative”. It is very hard to draw any conclusion other than that rates have some way further to rise.
— Ian Shepherdson, High Frequency Economics

There is no hint of a pause and no hint of a need to raise rates at a more rapid pace. Therefore, we continue to stick to our view that the Fed will raise rates at each of the remaining meetings this year, putting the fed funds rate at 4.25% by the end of the year. We also continue to look for the funds rate to reach 5% by the middle of next year.
— John Ryding, Conrad DeQuadros, Elena Volovelsky, of Bear Stearns

With the expansion projected to accelerate in the third quarter and inflation projected to be contained, the Fed is expected to “play the same tune” and “dance the same step” into early 2006. This means “measured” quarter-point adjustments at meetings in September, November, and December 2005, at which time the federal funds rate will reach 4.25%.
— Brian Bethune, Global Insight

Economists React [Wall Street Journal]