Date: January 30, 2019
Based on the latest information received by the Federal Open Market Committee (FOMC) since December, The FOMC has indicated the labor market has continued to strengthen and that economic activity has been rising at a solid rate. In addition to this, Job gains have been strong on average in recent months. In conjunction, the unemployment rate has remained low along with household spending continuing to grow strongly. Additionally, the growth of business fixed investment has moderated from its rapid pace earlier last year. The announcement also stated that: “On a 12-month basis, both overall inflation and inflation for items other than food and energy remain near 2 percent. Although market-based measures of inflation compensation have moved lower in recent months, survey-based measures of longer-term inflation expectations are little changed.”
In line with its verdict, the Committee seeks to foster maximum employment and price stability. In support of these goals, the Committee decided to maintain the target range for the federal funds rate at 2 1/4 to 2-1/2 percent. The Committee continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2 percent objective as the most likely outcomes.
When determining future adjustments to the federal funds rate and target range, the committee has stated that they will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective. The committee indicated that the variables that will be taken into account include labor 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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