WASHINGTON––As expected, the Federal Reserve has opted to stand pat on rates.
At the conclusion of its two-day meeting Wednesday, the Federal Open Market Committee, citing a steady economy, decided to maintain the target range for the federal funds rate at 1.50% to 1.75%.
“The labor market remains strong and … economic activity has been rising at a moderate rate. Job gains have been solid, on average, in recent months, and the unemployment rate has remained low,” reported the Fed in a statement.
The FOMC noted, however, that “although household spending has been rising at a moderate pace, business fixed investment and exports remain weak. On a 12‑month basis, overall inflation and inflation for items other than food and energy are running below 2%. Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed.”
The committee added that it judges the “current stance of monetary policy is appropriate to support sustained expansion of economic activity, strong labor market conditions, and inflation returning to the Committee's symmetric 2% objective.”
Of note, more than half of the committee members previously projected that the federal funds rate will remain unchanged throughout 2020. The FOMC will next meet Mar. 17-18.