Meeting Date:  January 26-27, 2016

Economic Highlights
Economic portrait of the economy shows labor markets improved further, in the face of slower economic growth.
“Information received since the Federal Open Market Committee met in December suggests that labor market conditions improved further even as economic growth slowed late last year. Household spending and business fixed investment have been increasing at moderate rates in recent months, and the housing sector has improved further; however, net exports have been soft and inventory investment slowed. A range of recent labor market indicators, including strong job gains, points to some additional decline in underutilization of labor resources. Inflation has continued to run below the Committee's 2 percent longer-run objective, partly reflecting declines in energy prices and in prices of non-energy imports. Market-based measures of inflation compensation declined further; survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months.”

Policy Announcements
Fed keeps rates unchanged.
“Given the economic outlook, 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.”

Fed’s Security Holdings
No change from last FOMC meeting.  Total dollars injected into the economy from the Large Scale Asset Purchase programs to remain constant.
“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.”

A Policy Explanation
The policy goal of 2.0% inflation is now officially called “symmetric” as described in a rare “Implementation Note”.
“…the statement has been amended to indicate that the Committee would be concerned if inflation were running persistently above or below (emphasis added) its 2 percent objective. All but one participant supported the amended statement. “

Voting Results
All votes “Yes”
Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Lael Brainard; James Bullard; Stanley Fischer; Esther L. George; Loretta J. Mester; Jerome H. Powell; Eric Rosengren; and Daniel K. Tarullo.

Next Meeting: March 15-16, 2016

The preceding information contains excerpts from an official published statement on the Federal Open Market Committee’s January 26-27, 2016 meeting.  For full text, please visit the Federal Reserve website.