Economic Expansion Continues at Solid Pace
Recent economic indicators suggest that growth has maintained its momentum, with labor market conditions easing since the start of the year. Although the unemployment rate has risen slightly, it remains remarkably low. Meanwhile, inflation has made significant strides towards the 2% target, but still hovers above this mark.
Balancing Risks and Opportunities
The Federal Reserve Committee is committed to achieving maximum employment and 2% inflation over the long term. Currently, the risks to achieving these dual goals are evenly balanced. However, the Committee acknowledges the uncertainty surrounding the economic outlook and remains vigilant to potential risks on both sides of its mandate.
Monetary Policy Adjustments
To support its objectives, the Committee has decided to lower the federal funds rate target range by 0.25 percentage points to 4.25-4.5%. This decision will be closely followed by careful assessments of incoming data, evolving outlooks, and risk balances. The Committee will continue to reduce its holdings of Treasury securities, agency debt, and agency mortgage-backed securities.
Commitment to Maximum Employment and Price Stability
The Committee reaffirms its strong commitment to supporting maximum employment and returning inflation to its 2% objective. By carefully navigating the complexities of the economic landscape, the Committee aims to foster a stable and prosperous environment for sustainable growth.
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