Newsroom

June 15, 2016

FOMC leaves interest rate, policy unchanged

The Federal Open Market Committee today said it is leaving the federal funds target rate unchanged at a range of 0.25 to 0.5 percent and is making no policy changes this month.

The FOMC released this policy statement at the close of its two-day meeting Wednesday.

"The decision to leave rates the same was widely expected, especially after the disappointing job numbers in May," said NAFCU Chief Economist and Director of Research Curt Long. "July is still a possibility if employment data is better this month, but it is more likely the committee will now wait until the third quarter or later."

In its revised forecast, the committee indicated that it anticipates a more gradual pace of rate normalization than previously estimated. The median forecast for the fed funds rate was 0.9 percent at the end of this year, 1.6 percent by year end 2017, and 2.4 percent in 2018.

The committee will meet for another two-day policy-setting session July 26-27.

Long noted in an interview with Bankrate earlier this week that the FOMC is also eyeing economic instability abroad as it waits to act on a rate hike.

The FOMC raised the federal funds target rate to a range of 0.25 to 0.5 percent in December.