Meeting Date: June 14-15, 2016

Economic Highlights
Labor market conditions have been mixed with a lower unemployment rate but lower job gains.
“Information received since the Federal Open Market Committee met in April indicates that the pace of improvement in the labor market has slowed while growth in economic activity appears to have picked up. 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. 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. Market-based measures of inflation compensation declined; most survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months.”

Policy Announcements
Fed keeps Fed Funds rate fixed for fourth consecutive meeting but claims new policy is still “Accommodative.”
“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.”

Forward Guidance
A FOMC will raise rates very slowly and only if the economy continues to improve, and the committee warns that rates are likely to remain below levels that are expected to prevail in the longer run for some time!
“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.”

Voting Results
No dissenting votes! Esther George, Kansas City Fed president, did not dissent at this meeting after voting “no” at the last two meetings. 
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:  July 26-27, 2016

The preceding information contains excerpts from an official published statement on the Federal Open Market Committee’s June 14-15, 2016 meeting.  For full text, please visit the Federal Reserve website.