The Federal Reserve has released a statement from the Federal Open Market Committee (FOMC) indicating that economic activity continues to expand at a steady pace. The unemployment rate has remained stable, and labor market conditions are solid, although inflation is still somewhat elevated.
The Committee aims for maximum employment and an inflation rate of 2 percent over the long term. However, there is increased uncertainty regarding the economic outlook, and the Committee remains vigilant about risks affecting its dual mandate.
To support these goals, the FOMC decided to maintain the federal funds rate target range at 4-1/4 to 4-1/2 percent. Future adjustments will be based on incoming data, economic developments, and risk assessments. Additionally, the Committee plans to continue reducing its holdings of Treasury securities and agency debt. Starting in April, it will decrease the monthly redemption cap on Treasury securities from $25 billion to $5 billion while maintaining the cap on agency debt and mortgage-backed securities at $35 billion.
The FOMC emphasized its commitment to achieving maximum employment and reducing inflation to its 2 percent goal. It will closely monitor new information affecting economic prospects and adjust monetary policy as needed if risks threaten its objectives. This includes considering various factors such as labor market conditions, inflation pressures, expectations, financial changes, and international developments.
Jerome H. Powell, Chair; John C. Williams, Vice Chair; Michael S. Barr; Michelle W. Bowman; Susan M. Collins; Lisa D. Cook; Austan D. Goolsbee; Philip N. Jefferson; Adriana D. Kugler; Alberto G. Musalem; and Jeffrey R. Schmid voted in favor of this policy action. Christopher J. Waller voted against it as he supported no change in the federal funds target range but preferred continuing with the current pace of decline in securities holdings.
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