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WASHINGTON (TND) — The Federal Open Market Committee voted unanimously Wednesday to hold the federal funds target range at 5.25% to 5.5% for the second meeting in a row.The committee will also continue to reduce its balance sheet in an attempt to reach its target 2% inflation rate. Federal Reserve Chair Jerome Powell said the process of reaching that goal “has a long way to go.” Core Personal Consumption Expenditures (PCE), the index watched closest by the Fed, gauged inflation at 3.7% in September. “Given how far we have come, along with the uncertainties and risks we face, the committee is proceeding carefully,” Powell said. Powell made news when he revealed Fed staff did not add a recession back into its forecast, information that’s typically not disclosed until meeting minutes are released weeks later. The comment sparked a jump in major stock indices before Wednesday’s closing bell.He noted economic activity has been expanding at a pace stronger than previously expected, while increased rates have been weighing down the housing market and business fixed investment. “But a few months of good data are only the beginning of what it will take to build confidence that inflation is moving down sustainably toward our goal,” Powell said, referring to encouraging inflation reports in recent months. Earlier in the day, the monthly Job Openings and Labor Turnover Survey showed September ended with 9.6 million open jobs, which was little changed from the prior month. Quits and layoffs were also little changed at 3.7 million and 1.5 million, respectively. “Those numbers show that workers are still willing to shuffle around to other jobs, just maybe a little bit less so than they used to be as we look into a holiday season of hiring for those purposes,” Lightcast Senior Economist Rachel Sederberg said. Powell said if there’s evidence tightness in the labor market has stopped easing, or if outsized economic growth persists, it could warrant further tightening of monetary policy.
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