As was anticipated, it kept the rates steady at a range of 3.5 per cent to 3.75 per cent. The decision, however, was not unanimous as four officials dissented.
“Recent indicators suggest that economic activity has been expanding at a solid pace. Job gains have remained low, on average, and the unemployment rate has been little changed in recent months. Inflation is elevated, in part reflecting the recent increase in global energy prices,” the Fed said in a statement.
“The Committee seeks to achieve maximum employment and inflation at the rate of 2 per cent over the longer run. Developments in the Middle East are contributing to a high level of uncertainty about the economic outlook. The Committee is attentive to the risks to both sides of its dual mandate,” the statement said justifying the decision to maintain the target range.
“In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook and the balance of risks,” it said.
“The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 per cent objective,” it added.
In assessing the appropriate stance of monetary policy, the Committee “will continue to monitor the implications of incoming information for the economic outlook”. The Committee, the release said, would be prepared to adjust the stance of monetary policy as appropriate if risks emerged that could impede the attainment of the Committee’s goals.
