Federal Reserve System (USA)
Media Release, Mar 21, 2018
Funds Rate: 1.50 - 1.75 % (+ 0.25)
Information received since the Federal Open Market Committee met in
January indicates that the labor market has continued to strengthen and
that economic activity has been rising at a moderate rate. Job gains have
been strong in recent months, and the unemployment rate has stayed low.
Recent data suggest that growth rates of household spending and business
fixed investment have moderated from their strong fourth-quarter readings.
On a 12-month basis, both overall inflation and inflation for items other
than food and energy have continued to run below 2 percent. Market-based
measures of inflation compensation have increased in recent months but
remain low; survey-based measures of longer-term inflation expectations
are little changed, on balance.
Consistent with its statutory mandate,
the Committee seeks to foster maximum employment and price stability. The
economic outlook has strengthened in recent months. The Committee expects
that, with further gradual adjustments in the stance of monetary policy,
economic activity will expand at a moderate pace in the medium term and
labor market conditions will remain strong. Inflation on a 12-month basis
is expected to move up in coming months and to stabilize around the
Committee's 2 percent objective over the medium term. Near-term risks to
the economic outlook appear roughly balanced, but the Committee is
monitoring inflation developments closely.
In view of realized and expected labor
market conditions and inflation, the Committee decided to raise the target
range for the federal funds rate to 1-1/2 to 1-3/4 percent. The stance of
monetary policy remains accommodative, thereby supporting strong labor
market conditions and a sustained return to 2 percent inflation.
In determining 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 objectives of maximum employment and 2 percent inflation. This
assessment will take into account a wide range of information, including
measures of labor market conditions, indicators of inflation pressures and
inflation expectations, and readings on financial and international
developments. The Committee will carefully monitor actual and expected
inflation developments relative to its symmetric inflation goal. The
Committee expects that economic conditions will evolve in a manner that
will warrant further gradual increases in the federal funds rate; the
federal funds rate is likely to remain, for some time, below levels that
are expected to prevail in the longer run. However, the actual path of the
federal funds rate will depend on the economic outlook as informed by
Voting for the FOMC monetary policy
action were Jerome H. Powell, Chairman; William C. Dudley, Vice Chairman;
Thomas I. Barkin; Raphael W. Bostic; Lael Brainard; Loretta J. Mester;
Randal K. Quarles; and John C. Williams.
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