WASHINGTON—As expected the Federal Reserve’s Open Market Committee opted not to move on rates, leaving the federal funds target rate unchanged at a range of 0.25 to 0.5%.
NAFCU’s chief economist, Curt Long, said the statement issued by the Fed in conjunction with the decision was largely positive.
“The assessments of the economy in general and the labor market in particular were more upbeat, and the committee deemed that risks had diminished,” said Long. “Nevertheless, there was no indication that the committee anticipates that inflation will pick up in the near term, which leaves them enough slack to maintain a cautious approach to normalizing rates.”
CUNA Senior Economist Perc Pineda said the FOMC’s decision to keep the federal funds rate unchanged at its meeting confirms CUNA's view that U.S. economic growth continues to be modest.
"Brexit has had minimal effects on the U.S. financial market so far, the dismal May job numbers were an aberration – given strong job gains in June – and inflation is creeping up, but the uncertainty of the pace of economic expansion has kept the FOMC cautious. We will know how the U.S. economy has fared recently Friday when the second quarter GDP advance estimates arrive,” Pineda said.
The FOMC will meet for another two-day policy-setting session Sept. 20-21.