The FOMC statement, as revised:
Information received since the Federal Open Market Committee met in
January suggestsMarch indicates that the economic recovery is on a firmer footing,proceeding at a moderate pace and overall conditions in the labor market appear to beare improving gradually. Household spending and business investment in equipment and software continue to expand. However, investment in nonresidential structures is still weak, and the housing sector continues to be depressed. Commodity prices have risen significantly since thelast summer, and concerns about global supplies of crude oil have contributed to a sharp run-upfurther increase in oil prices in recent weekssince the Committee met in March. Nonetheless,Inflation has picked up in recent months, but longer-term inflation expectations have remained stable ,and measures of underlying inflation have beenare still subdued.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability.
Currently, theThe unemployment rate remains elevated, and measures of underlying inflation continue to be somewhat low, relative to levels that the Committee judges to be consistent, over the longer run, with its dual mandate. The recent increasesIncreases in the prices of energy and other commodities are currently putting upward pressure on inflationhave pushed up inflation in recent months. The Committee expects these effects to be transitory, but it will pay close attention to the evolution of inflation and inflation expectations. The Committee continues to anticipate a gradual return to higher levels of resource utilization in a context of price stability.
To promote a stronger pace of economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate, the Committee decided today to continue expanding its holdings of securities as announced in November. In particular, the Committee is maintaining its existing policy of reinvesting principal payments from its securities holdings and
intends to purchasewill complete purchases of $600 billion of longer-term Treasury securities by the end of the second quarter of 2011.current quarter. The Committee will regularly review the pacesize and composition of its securities purchases and the overall size of the asset-purchase programholdings in light of incoming information and will adjust the programis prepared to adjust those holdings as needed to best foster maximum employment and price stability.
The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels for the federal funds rate for an extended period.
The Committee will continue to monitor the economic outlook and financial developments and will employ its policy tools as necessary to support the economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; Elizabeth A. Duke; Charles L. Evans; Richard W. Fisher; Narayana Kocherlakota; Charles I. Plosser; Sarah Bloom Raskin; Daniel K. Tarullo; and Janet L. Yellen.
Today, for the first time, Bernanke is holding a press conference in connection with the FOMC meeting; that will begin at 2:15 Eastern Time.