FOMC leaves key policy rate unchanged

The FOMC kept policy unchanged and repeated the economy continues to expand "moderately." There were no surprises in the language or signals regarding tightening in September. However, the tone was slightly more upbeat than in June, the Fed sounding more confident on the labour market, now noting that that, "a range of labor market indicators suggests that underutilization of labor resources has diminished since early this year" versus, "a range of labor market indicators suggests that underutilization of labor resources diminished somewhat". 

The housing market continued to improve, though business fixed investment and net exports remained soft. The inflation outlook remained the same with the FOMC still looking for a move toward the 2% target. Overall, the slight upgrade to the labour market view keeps the September meeting in play.