November 1, 2017 / 6:08 PM / 22 days ago

FOMC statement from Oct 31-Nov 1 meeting

WASHINGTON - Following is the full text of the statement released by the Federal Reserve’s Federal Open Market Committee on Wednesday following a two-day meeting:

Information received since the Federal Open Market Committee met in September.

indicates that the labor market has continued to strengthen and that economic activity has

been rising at a solid rate despite hurricane-related disruptions. Although the hurricanes

caused a drop in payroll employment in September, the unemployment rate declined

further. Household spending has been expanding at a moderate rate, and growth in

business fixed investment has picked up in recent quarters. Gasoline prices rose in the

aftermath of the hurricanes, boosting overall inflation in September; however, inflation

for items other than food and energy remained soft. On a 12-month basis, both inflation

measures have declined this year and are running below 2 percent. Market-based

measures of inflation compensation 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. Hurricane-related disruptions and rebuilding will

continue to affect economic activity, employment, and inflation in the near term, but past

experience suggests that the storms are unlikely to materially alter the course of the

national economy over the medium term. Consequently, the Committee continues to

expect that, with gradual adjustments in the stance of monetary policy, economic activity

will expand at a moderate pace, and labor market conditions will strengthen somewhat

further. Inflation on a 12-month basis is expected to remain somewhat below 2 percent in

the near term but 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 maintain the target range for the federal funds rate at 1 to

1-1/4 percent. The stance of monetary policy remains accommodative, thereby

supporting some further strengthening in 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 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 incoming data.

The balance sheet normalization program initiated in October 2017 is proceeding.

Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair;

William C. Dudley, Vice Chairman; Lael Brainard; Charles L. Evans; Patrick Harker;

Robert S. Kaplan; Neel Kashkari; Jerome H. Powell; and Randal K. Quarles.

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