The US Federal Reserve keeps interest rates unchanged, but pointed our that the labor market continues to strengthen and economic activity is growing at a rapid pace. The two-day meeting, which was held on November 7 and 8, was expected from global markets, with most analysts predicting central bankers to keep the monetary policy but not raising benchmark interest rates.
The report shows that the unemployment rate continues to decline, while household spending remains strong and the growth in real estate investment slows down faster than in the previous months.
On annual basis the inflation remain at the level of 2%.
The Fed seeks to promote maximum employment in the labor market and price stability, says the report of the central bankers. The bankers expect that the gradual increase in the target range of interest rates to be in line with sustained growth in economic activity, strong labor market and 2% inflation in the medium term.
The risks to the economic outlook appear to be fairly balanced.
Given the realized and expected labor market conditions and inflation, the Fed decided to keep the target range at interest rates from 2 to 2.25%.
Depending on the timing and magnitude of future federal funds interest rate adjustments, the participants in the meeting decided to assess the realized and expected economic conditions and the maximum employment target and its symmetrical 2-percent inflation target. This assessment will take into account the wide range of inflation, including labor market measures, inflationary inflation indicators and inflation expectations, and indications of financial and international developments.
At a previous Fed meeting held on September 25-26, the bankers said they had confidence in the pace of economy growth but felt somewhat hesitant about the impact that US duties might have in the future.
The Fed representatives reaffirmed their conviction that the gradual rise in interest rates is the best solution for preserving the stability of the economy.
The bankers are expected to raise interest rates again in December, impacting the US domestic economic environment.