Date: March 20, 2019
Based on data received since the Federal Open Market Committee met in May indicates that the labor market has continued to strengthen and that economic activity has been rising at a solid rate. Job gains have been strong, on average, in recent months, and the unemployment rate has declined. Recent data suggest that growth of household spending has slowed down along with business fixed investments. On a 12-month basis, both overall inflation and inflation for items other than food and energy have moved close to 2 percent, largely as a result of lower energy prices. Indicators of longer-term inflation expectations are little changed, on balance.
Aligned with its statutory mandate, the Committee seeks to support maximum employment and price stability. The Committee expects 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 percent objective over the medium term. Risks to the economic outlook appear roughly balanced.
Considering the realized and expected labor market conditions and inflation, the Committee decided to maintain the target range for the federal funds rate to 2-1/4 to 2-1/2 percent. The Committee continues to view sustained expansion of economic activity, strong labour market conditions, and inflation near the Committee’s symmetric 2 percent objective as the most likely outcomes. Taking into account the global economic and financial developments and muted inflation pressures, the committee noted that it will be patient as it determines what future adjustments to the target range for the federal funds rate may be appropriate to support these outcomes.
In shaping the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective. This assessment will take into account a wide range of information, including measures of labour market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.
Voting for the FOMC monetary policy action were Jerome H. Powell, Chairman; John C. Williams, Vice Chairman; Michelle W. Bowman; Lael Brainard; James Bullard; Richard H. Clarida; Charles L. Evans; Esther L. George; Randal K. Quarles; and Eric S. Rosengren.
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