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Fed holds federal funds rate target at 3.5% to 3.75%

The FOMC kept the policy stance unchanged in a 9 to 3 vote, citing solid economic expansion and inflation still above its 2% goal.

Reported · Written up by our desk · Central Banks

The Federal Reserve’s Federal Open Market Committee decided to maintain the target range for the federal funds rate at 3.5% to 3.75%, voting 9 to 3, according to the Fed’s released FOMC statement.

The Committee said economic activity is expanding at a solid pace despite elevated uncertainty, with productivity growth and capital investment remaining strong. Job gains are keeping pace with the workforce, and the unemployment rate has changed little.

On inflation, the Fed said price pressures remain elevated versus its 2% goal, in part due to supply shocks and price increases in sectors including energy, while noting it will deliver price stability.

The statement also said the Fed plans to continue maintaining ample reserves in the banking system. The three voting against the decision were Beth M. Hammack, Neel Kashkari, and Lorie K. Logan, who preferred raising the target range by 0.25 percentage point at this meeting.

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