The Fed upgraded its assessment of U.S. economic activity to a strong pace Wednesday, citing resilient spending, productivity growth and robust capital investment as it held the federal funds target range at 3.75% to 4%.
The Federal Open Market Committee (FOMC) voted 10-2 to keep the target range at 3.75% to 4%, with Federal Reserve Governor Lisa D. Cook and Federal Reserve Bank of Cleveland President and CEO Beth M. Hammack favoring a quarter-point increase. The decision followed a unanimous quarter-point increase on Sept. 16; EconoTimes previously reported on the rate hold and two dissenting votes.
The committee shifted its description of economic activity from September’s “solid pace” to a “strong pace.” It pointed to spending in the United States holding firm, alongside productivity gains and substantial capital investment. The Fed said employment gains were keeping pace with workforce growth, unemployment had barely shifted and inflation remained high. It also cited geopolitical developments as a source of uncertainty.
The FOMC left its next move open, saying it would weigh new information as it considers the appropriate policy setting. The Fed’s calendar lists its next two-day meeting for Dec. 8-9.
