FOMC's decisions regarding monetary policy implementation - Sep 20, 2017
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The Federal Reserve has made the following decisions to implement the monetary policy stance announced by the Federal Open Market Committee (FOMC) in its statement on September 20th, 2017, after a 2-day meeting where it determined to leave interest rates unchanged and star the balance sheet reduction in October:
Key headlines (via Reuters):
- Fed leaves target interest rate unchanged at 1.00-1.25 pct , still sees one more rate hike in 2017
- Fed's projections point to three rate hikes in 2018, two in 2019 and one in 2020
- Fed cuts estimate of longer-run neutral rate to 2.75 pct from 3.00 pct
- Fed says to start shrinking balance sheet in October following schedule it laid out in July
- Recent storms will affect near-term economic activity but unlikely to alter course over medium term
- Inflation to rise temporarily in aftermath of hurricanes
- Apart from hurricane effect, inflation to remain somewhat below 2 pct in near term, to stabilize around 2 pct goal over medium term
- Job gains have remained solid, household spending expanding at moderate rate
- Business spending has picked up in recent quarters
- Near-term risks to the economy appear "roughly balanced," Fed monitoring inflation closely
- Fed vote in favor of policy was unanimous
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