FOMC statement of July 27, 2016
This statement of the Federal Open Market Committee, compared sentence by sentence with the scheduled statement before it: what changed in the text, and how the Committee voted.
In short
The Federal Open Market Committee released this statement on July 27, 2016. Compared with the previous scheduled statement of June 15, 2016: 2 sentences changed, 5 were added, 3 were removed, and 14 stayed the same. In words: 91 added, 63 removed. The vote on this statement: 1 member voted against: Esther L. George. On the June 15, 2016 statement: Unanimous.
FOMC statement · July 27, 2016
Changed sentences against the previous scheduled statement (June 15, 2016)
14 unchanged · 2 changed · 5 added · 3 removed · words +91 / −63
- June 15, 2016
- Unanimous.
- July 27, 2016
- 1 member voted against: Esther L. George.
Information received since the Federal Open Market Committee met in April June indicates that the pace of improvement in the labor market has slowed while growth in strengthened and that economic activity appears to have picked up has been expanding at a moderate rate.
Although the unemployment rate has declined, job gains have diminished.
Growth in household spending has strengthened.
Since the beginning of the year, the housing sector has continued to improve and the drag from net exports appears to have lessened, but business fixed investment has been soft.
Job gains were strong in June following weak growth in May.
On balance, payrolls and other labor market indicators point to some increase in labor utilization in recent months.
Household spending has been growing strongly but business fixed investment has been soft.
Market-based measures of inflation compensation declined remain low; most survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months.
Near-term risks to the economic outlook have diminished.
Voting against the action was Esther L. George, who preferred at this meeting to raise the target range for the federal funds rate to 1/2 to 3/4 percent.
Show the 14 unchanged sentences
Inflation has continued to run below the Committee's 2 percent longer-run objective, partly reflecting earlier declines in energy prices and in prices of non-energy imports.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability.
The Committee currently expects that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market indicators will strengthen.
Inflation is expected to remain low in the near term, in part because of earlier declines in energy prices, but to rise to 2 percent over the medium term as the transitory effects of past declines in energy and import prices dissipate and the labor market strengthens further.
The Committee continues to closely monitor inflation indicators and global economic and financial developments.
Against this backdrop, the Committee decided to maintain the target range for the federal funds rate at 1/4 to 1/2 percent.
The stance of monetary policy remains accommodative, thereby supporting further improvement in labor market conditions and a return to 2 percent inflation.
In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its objectives of maximum employment and 2 percent inflation.
This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.
In light of the current shortfall of inflation from 2 percent, the Committee will carefully monitor actual and expected progress toward its inflation goal.
The Committee expects that economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run.
However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data.
The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction, and it anticipates doing so until normalization of the level of the federal funds rate is well under way.
This policy, by keeping the Committee's holdings of longer-term securities at sizable levels, should help maintain accommodative financial conditions.
Source: Board of Governors of the Federal Reserve System — the statement on federalreserve.gov · June 15, 2016
How to read this page
The page sets this statement of the Federal Open Market Committee next to the scheduled statement before it, sentence by sentence. The Fed’s sentences are shown as published, in English.
In a changed sentence, the words that were dropped are struck through and the new words are underlined. A sentence found only in the newer statement is marked as added; one found only in the older statement, as removed. Sentences that did not change are collapsed.
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