The Federal Reserve and Janet Yellen have released their rate and monetary policy for the June 18 FOMC announcement. While inflation was seen ticking up in the CPI report this week, the reality is that much of the statement was still cookie-cutter and with only some light changes.

Bond tapering will continue by another $10 billion, down to $35 billion per month. The Federal Reserve will trim its agency mortgage-backed securities purchases to $15 billion per month rather than $20 billion per month, and longer-term Treasury securities will be trimmed to $20 billion per month rather than $25 billion per month. The Fed will also continue its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction.

The majority of Fed officials expect rate hikes in 2015, with a steeper rate rise in 2015 or 2016. Some 15 of 16 officials see rates at or below the 0.25% Fed Funds rate through the end  of 2014. 11 of 16 see Fed Funds at or under 1.25% through the end of 2015. Over half still expect that Fed Funds will be at or under 2.5% through the end of 2016. Three of the FOMC members do not expect rate hikes to begin until 2016.

For GDP projections, the FOMC is lowering its growth to 2.1% to 2.3% from 2.8% to 3.0% in 2014. GDP growth is now put in a range of 3.0% to 3.2% in 2015, followed by 2.5% to 3.0% in 2016.

Unemployment expectations have also been tweaked.  The new expectations are 6.0% to 6.1% in late 2014, 5.4% to 5.7% in late 2015, and 5.1% to 5.5% in late 2016.

The FOMC inflation targets are basically the same. That is for 1.5% to 1.7% in 2014, followed by 1.5% to 2.0% in 2015, and 1.6% to 2.0% in 2016.

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