The US Federal Open Market Committee raised the target range for the federal funds rate by a quarter percentage point to 3.75% to 4%, while continuing its policy of maintaining ample reserves in the banking system. The decision was approved unanimously by a 12-0 vote and is intended to support a timelier return of inflation to the Federal Reserve’s 2% goal. The committee assessed that economic activity is expanding at a solid pace despite elevated uncertainty partly linked to geopolitical developments. Domestic spending has remained resilient, productivity growth is strong and capital investment is robust. Job gains have kept pace with workforce growth, the unemployment rate has changed little and inflation remains elevated.
US Federal Open Market Committee raises federal funds target range by 25 basis points to 3.75% to 4%
The US Federal Open Market Committee unanimously raised the federal funds target range by 25 basis points to 3.75% to 4% and maintained its ample reserves policy. The increase is intended to support a timelier return of still elevated inflation to the Federal Reserve’s 2% goal.