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What Does 'Gradual' Mean?

Economists expect rate liftoff at Wednesday's Federal Reserve meeting, but question what the rate-rise path will look like thereafter.

By Craig Torres and Catarina Saraiva, Bloomberg | Updated on December 11, 2015

Economists have given Federal Reserve Chair Janet Yellen a mission for next week’s press conference: Explain what “gradual” means.

The Federal Open Market Committee in September projected an interest rate policy path that, including December, averages four interest rate hikes a year through the end of 2018. That’s half the pace of the last tightening campaign, when rates were raised by a quarter point every meeting from June 2004 until peaking two years later at 5.25 percent.

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