FOMC: “Progress” made but is it enough to taper?
|Summary
- As widely expected, the FOMC did not make any major policy changes at today's meeting. The decisions to keep the target range for the fed funds rate unchanged as well as the pace of asset purchases was unanimously supported by all 11 voting members of the Committee.
- The FOMC acknowledged that "progress" has been made toward reaching the Committee's goals of maximum employment and price stability. But probably not enough progress yet to warrant a near-term commencement of tapering asset purchases.
- We continue to forecast that the FOMC will keep its target range for the fed funds rate unchanged through at least the end of next year.
- We look for Fed officials to begin dropping hints in the next month or two about an eventual tapering of asset purchases. We look for a formal announcement to be made at the December FOMC meeting, with the actual process of winding down the purchases to begin early next year.
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