Differences Between Current And Previous FOMC Announcements
Information received since the Federal Open Market Committee met in AugustSeptember suggests that economic activity has continued to expand at a moderate pace in recent months. Growth Growth in employment has been slow, and the unemployment rate remains elevated. Household Household spending has continued to advance,advanced a bit more quickly, but growth in business fixed investment appears to havehas slowed. The The housing sector has shown some further signs of improvement, albeit from a depressed level. Inflation has been subdued, although the prices of some key commodities have increased recently. Longer-term Inflation recently picked up somewhat, reflecting higher energy prices. Longer-term inflation expectations have remained stable.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The The Committee isremains concerned that, without furthersufficient policy accommodation, economic growth might not be strong enough to generate sustained improvement in labor market conditions. Furthermore, Furthermore, strains in global financial markets continue to pose significant downside risks to the economic outlook. The The Committee also anticipates that inflation over the medium term likely would run at or below its 2 percent objective.
To support a stronger economic recovery and to help ensure that
inflation, over time, is at the rate most consistent with its dual
mandate, the Committee agreed today to increase policy accommodation bywill continue purchasing additional agency mortgage-backed securities at a pace of $40 billion per month. The The Committee also will continue through the end of the year its program to extend the average maturity of its holdings of securities as announced in June,Treasury securities,
and it is maintaining its existing policy of reinvesting principal
payments from its holdings of agency debt and agency mortgage-backed securities securities in agency mortgage-backed securities. These These
actions, which together will increase the Committee's holdings of
longer-term securities by about $85 billion each month through the end
of the year, should put downward pressure on longer-term interest rates,
support mortgage markets, and help to make broader financial conditions
more accommodative.
The Committee will closely monitor incoming information on economic and financial developments in coming months. If If
the outlook for the labor market does not improve substantially, the
Committee will continue its purchases of agency mortgage-backed
securities, undertake additional asset purchases, and employ its other
policy tools as appropriate until such improvement is achieved in a
context of price stability. In In determining the
size, pace, and composition of its asset purchases, the Committee will,
as always, take appropriate account of the likely efficacy and costs of
such purchases.
To support continued progress toward maximum employment and price
stability, the Committee expects that a highly accommodative stance of
monetary policy will remain appropriate for a considerable time after
the economic recovery strengthens. In In
particular, the Committee also decided today to keep the target range
for the federal funds rate at 0 to 1/4 percent and currently anticipates
that exceptionally low levels for the federal funds rate are likely to
be warranted at least through mid-2015.
Voting for the FOMC monetary policy action were: Ben S. Bernanke,
Chairman; William C. Dudley, Vice Chairman; Elizabeth A. Duke; Dennis P.
Lockhart; Sandra Pianalto; Jerome H. Powell; Sarah Bloom Raskin; Jeremy
C. Stein; Daniel K. Tarullo; John C. Williams; and Janet L. Yellen. Voting Voting against the action was Jeffrey M. Lacker, who opposed additional asset purchases and preferred to omitdisagreed with the description of the time period over which a highly accommodative stance of monetary policy will remain appropriate and exceptionally low levels for the federal funds rate are likely to be warranted.