Fed has become World Central Bank

The U.S. Federal Reserve left interest rates unchanged yet strongly indicated that it could still tighten monetary policy by the end of this year as the labor market improved further. Wages are actually rising because the work force is aging actually reducing the availability of workers in many skilled areas other than doctors, lawyers, and politicians.

Janet Yellen stated bluntly that U.S. growth was looking stronger and rate increases would be needed to keep the economy from overheating and fueling higher inflation. But this does not take into account fiscal policy, which the Fed cannot control.

Emerging markets accumulated dollar debt equal to about 50% of the US National Debt. A US rate hike will cause problems in that area while it will signal also disaster for Japan and Europe. So the statements of Yellen may sound unimportant, but there was no discussion of negative rates coming from the Fed.