Although “labor market conditions have improved,” real household income “has risen at a solid rate,” and “the housing sector has improved” since its previous meeting, the Federal Open Market Committee (FOMC) voted in March to “maintain the target range for the federal funds rate at 0.25% to 0.50%,” due mainly to the fact that “economic activity appears to have slowed” and “household spending has moderated,” plus, “inflation has continued to run below the committee’s two percent longer-run objective, partly reflecting earlier declines in energy prices and falling prices of non-energy imports,” the FOMC’s statement released today shows.
So, when might the Fed move to raise short-term interest rates again? Tough to predict because, as usual, the committee only says that it will “assess realized and expected economic conditions relative to its objectives of maximum employment and two percent inflation.”
“Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months,” the FOMC says in its statement.
To read the whole (exciting) thing, click here.