WASHINGTON–As expected, the Federal Open Market Committee has opted to leave rates unchanged.
“In view of realized and expected labor market conditions and inflation, the Committee decided to maintain the target range for the federal funds rate at 1-3/4 to 2%,” the FOMC said at the conclusion of its two-day meeting here. “The stance of monetary policy remains accommodative, thereby supporting strong labor market conditions and a sustained return to 2% inflation.”
The Fed said that since it last met in June the data indicate the labor market has continued to strengthen and that economic activity has been rising at a strong rate. Job gains have been strong, on average, in recent months, and the unemployment rate has stayed low, the Fed added.
“Household spending and business fixed investment have grown strongly,” the FOMC said in its statement. “On a 12-month basis, both overall inflation and inflation for items other than food and energy remain near 2%. Indicators of longer-term inflation expectations are little changed, on balance.”
The Committee again noted that further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2% objective over the medium term. Risks to the economic outlook appear roughly balanced, it said.
Analysts have said they expect two more rate increases this year by the Fed.
Voting for the FOMC monetary policy action were: Jerome H. Powell, Chairman; John C. Williams, Vice Chairman; Thomas I. Barkin; Raphael W. Bostic; Lael Brainard; Esther L. George; Loretta J. Mester; and Randal K. Quarles.