The Federal Open Market Committee announced today that it would cut interest rates for the third time this year. The committee approved another quarter-point decrease in the target range for the federal funds rate to a range of 1.5-1.75% in a statement at the conclusion of the meeting.
The FOMC noted that labor market conditions remain strong and economic activity has continued to rise at a moderate rate, but that overall inflation and inflation for items other than food and energy are running below the Federal Reserve’s 2% target. In addition, business fixed investment and exports remain weak and the global outlook is uncertain.
The rate cut “supports the Committee’s view that sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2% objective are the most likely outcomes, but uncertainties about this outlook remain,” the FOMC said, adding that it will “continue to monitor the implications of incoming information for the economic outlook as it assesses the appropriate path of the target range for the federal funds rate.”