Fed leaves rates unchanged, notes slowing in business investment

Friday,   09-Nov-2018   09:35 AM (IST)

The Federal Open Market Committee, as expected, unanimously approved keeping the federal funds rate in a range of 2 percent to 2.25 percent. There was no mention of the volatility that has gripped financial markets since mid-October in the central bank's statement. The committee noted in the statement that the unemployment rate "has declined" since the September meeting. The statement noted that the "growth of business fixed investment has moderated from its rapid pace earlier in the year." In its first meeting since October's market turmoil and this week's midterm elections, the Federal Reserve voted to maintain the current level of its benchmark interest rate. The policymaking Federal Open Market Committee, as expected, unanimously approved keeping the federal funds rate in a range of 2 percent to 2.25 percent. Markets figured the central bank would hold the line at this meeting and probably approve a quarter-point hike in December, which would be the fourth of the year. There were a few tweaks to the way policymakers are viewing economic conditions. On the upside, the committee noted that the unemployment rate "has declined" since the September meeting. The Labor Department last week reported that the headline jobless level was at 3.7 percent, the lowest since December 1969. However, the statement noted that the "growth of business fixed investment has moderated from its rapid pace earlier in the year." There was no detail or data given for why officials see investment declining, though companies reported during third-quarter earnings season that some of their investment plans have been curtailed due to the ongoing trade war between the U.S. and China.