Release Date: October 29, 2014
For immediate release
Information received since the Federal Open Market Committee met in September suggests that economic activity is expanding at a moderate pace. Labor market conditions improved somewhat further, with solid job gains and a lower unemployment rate. On balance, a range of labor market indicators suggests that underutilization of labor resources is gradually diminishing. Household spending is rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow. Inflation has continued to run below the Committee's longer-run objective. Market-based measures of inflation compensation have declined somewhat; survey-based measures of longer-term inflation expectations have remained stable.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators and inflation moving toward levels the Committee judges consistent with its dual mandate. The Committee sees the risks to the outlook for economic activity and the labor market as nearly balanced. Although inflation in the near term will likely be held down by lower energy prices and other factors, the Committee judges that the likelihood of inflation running persistently below 2 percent has diminished somewhat since early this year.
The Committee judges that there has been a substantial improvement in the outlook for the labor market since the inception of its current asset purchase program. Moreover, the Committee continues to see sufficient underlying strength in the broader economy to support ongoing progress toward maximum employment in a context of price stability. Accordingly, the Committee decided to conclude its asset purchase program this month. 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. This policy, by keeping the Committee's holdings of longer-term securities at sizable levels, should help maintain accommodative financial conditions.
To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that the current 0 to 1/4 percent target range for the federal funds rate remains appropriate. In determining how long to maintain this target range, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments. The Committee anticipates, based on its current assessment, that it likely will be appropriate to maintain the 0 to 1/4 percent target range for the federal funds rate for a considerable time following the end of its asset purchase program this month, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored. However, if incoming information indicates faster progress toward the Committee's employment and inflation objectives than the Committee now expects, then increases in the target range for the federal funds rate are likely to occur sooner than currently anticipated. Conversely, if progress proves slower than expected, then increases in the target range are likely to occur later than currently anticipated.
When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent. The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.
Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Lael Brainard; Stanley Fischer; Richard W. Fisher; Loretta J. Mester; Charles I. Plosser; Jerome H. Powell; and Daniel K. Tarullo. Voting against the action was Narayana Kocherlakota, who believed that, in light of continued sluggishness in the inflation outlook and the recent slide in market-based measures of longer-term inflation expectations, the Committee should commit to keeping the current target range for the federal funds rate at least until the one-to-two-year ahead inflation outlook has returned to 2 percent and should continue the asset purchase program at its current level.
- Issue: Finance-
WASHINGTON, DC -- In this week's address, the President discussed the measures we are taking to respond to Ebola cases at home, while containing the epidemic at its source in West Africa. This week we continued to focus on domestic preparedness, with the creation of new CDC guidelines and the announcement of new travel measures ensuring all travelers from the three affected countries are directed to and screened at one of five airports. The President emphasized that it's important to follow the facts, rather than fear, as New Yorkers did yesterday when they stuck to their daily routine. Ebola is not an easily transmitted disease, and America is leading the world in the fight to stamp it out in West Africa.
October 30, 2014, Thursday 1:11 p.m.
Issue - Public Safety
As we have taken decisive steps to address today's dangers from terrorism and to prevent future nuclear proliferation, we have also sought to bolster homeland security and head off emerging challenges, ranging from cyber and biological threats to climate change and transnational crime.
October 30, 2014, Thursday 1:11 p.m.
Issue - Taxes & Spending
Taxes, by their very nature, reduce a citizen's freedom. Their proper role in a free society should be to fund services that are essential and authorized by the Constitution, such as national security, and the care of those who cannot care for themselves. We reject the use of taxation to redistribute income, fund unnecessary or ineffective programs, or foster the crony capitalism that corrupts both politicians and corporations.
October 30, 2014, Thursday 1:11 p.m.
Issue - Health
We favor restoring and reviving a free market health care system. We recognize the freedom of individuals to determine the level of health insurance they want (if any), the level of health care they want, the care providers they want, the medicines and treatments they will use and all other aspects of their medical care, including end-of-life decisions. People should be free to purchase health insurance across state lines.
Let's start with a few numbers:
$300 billion in savings. That's how much consumers and businesses have saved on utility bills in the last 22 years because of the ENERGY STAR program.
Two billion metric tons of greenhouse gas emissions avoided, or the equivalent to the annual emissions of more than 420 million cars, over the last 22 years. Thanks to our little blue ENERGY STAR label, folks are doing their part to reduce their greenhouse emissions and combat climate change.
Since President Obama took office, ENERGY STAR has helped American consumers and businesses save over one billion metric tons of greenhouse gas emissions and approximately $110 billion on their utility bills.
That's one powerful little label.
- Issue: Energy-
The responsibility of the Department of Defense is the security of our country. That requires thinking ahead and planning for a wide range of contingencies.
Among the future trends that will impact our national security is climate change. Rising global temperatures, changing precipitation patterns, climbing sea levels, and more extreme weather events will intensify the challenges of global instability, hunger, poverty, and conflict. They will likely lead to food and water shortages, pandemic disease, disputes over refugees and resources, and destruction by natural disasters in regions across the globe.
In our defense strategy, we refer to climate change as a "threat multiplier" because it has the potential to exacerbate many of the challenges we are dealing with today - from infectious disease to terrorism. We are already beginning to see some of these impacts.
- Issue: Military-
This week, President Obama took action to make consumers' credit card transactions more secure, voted early at the Martin Luther King Jr. Community Service Center in Chicago, welcomed the new Ebola Response Coordinator on his first day on the job, and talked science and tech with some of his top advisors. That's October 17 to October 23 or, "A Chip and PIN."
The President crossed town to the Consumer Financial Protection Bureau to announce his BuySecure Initiative, an executive order that helps protect Americans from falling victim to identity theft and credit card fraud.
Back on his home turf in Chicago, the President took advantage of the opportunity to vote early.
Rob Klain started his first day as the Ebola Response Coordinator, tasked by the President to oversee the administration's system-wide response to Ebola, at home and abroad.
The President convened his Council of Advisors on Science and Technology in the historic Roosevelt Room. Meanwhile, the Office of Digital Strategy held a meet up for 30 Americans who petitioned their government through We the People. They spent the afternoon hearing from senior Administration officials, and participating in Q&As.
- Issue: Federal-