Fed posts confidential staff projections after inadvertent release

Reporting from Washington —  The Federal Reserve on Friday released confidential staff economic projections prepared for its June meeting after the information was inadvertently made public on the board’s website in another embarrassing leak of sensitive information from the central bank.

The projections, which normally are not made public for five years, showed staff members expected the Fed to raise its benchmark short-term interest rate just one time this year.

Staff also projected that the economy would grow at less than 2% annually from 2018 to 2020 and inflation would remain below the Fed’s 2% annual target through at least 2020.

The projection that the so-called federal funds rate would be at 0.35% by year’s end was more precise than the range of between zero and 1% in the policymakers’ official forecast released in June.

The rate has been set at between zero and 0.25% since late 2008. The rate fluctuates daily in that range and was 0.13% at the time of the June meetings, indicating Fed staff expected one rate increase of 0.25 percentage points this year.

The long-term staff economic projections were more pessimistic than the policymakers’ forecast.

That forecast was for the economy to grow between 2% and 2.3% annually in the years after 2017.

Fed policymakers expected inflation to be between 1.9% and 2% in 2017 and hit 2% in the following years.

The Fed said Friday that staff projections, prepared every three months, “do not incorporate policymakers’ views, including their views on monetary policy.”

Staff present their projections to members of the Federal Reserve Board’s policymaking Federal Open Market Committee during meetings once every three months. The information is considered in the formal projections committee members make and release to the public at the end of the two-day meetings.

The staff projections are summarized in the minutes of the meeting released three weeks later.

But on June 29, the staff projections prepared for the June 16-17 meetings “were inadvertently included in a computer file posted to the board’s public website, “ the Fed said.

Because the projections already were made public, the Fed said Friday it was making the information “more easily accessible” on its website. The Fed posted a compressed file that contained charts and tables, as well as computer code.

The Fed said it referred the matter to the central bank’s inspector general’s office.

That office, along with the Justice Department and the House Financial Services Committee, are investigating a 2012 leak of confidential Fed information.

In that case, a newsletter from Medley Global Advisors in October 2012 contained details from the Federal Open Market Committee’s September meeting about the central bank’s bond-buying program before the meeting minutes were released.

Such information could be valuable to investors and traders and leaks are potentially illegal.

House Republicans have criticized the Fed for its handling of the 2012 leak, which was made public late last year in a report by ProPublica.

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