The Federal Reserve yesterday announced it will keep its target for the federal funds rate unchanged at 1 percent. In a prepared statement, the Fed said it "continues to believe that an accommodative stance of monetary policy, coupled with robust underlying growth in productivity, is providing important ongoing support to economic activity . . . output is expanding briskly, and the labor market appears to be improving modestly. Increases in core consumer prices are muted and expected to remain low."
The Fed also said that the upside and downside risks to the attainment of sustainable growth for the next few quarters are roughly equal. "The probability of an unwelcome fall in inflation has diminished in recent months and now appears almost equal to that of a rise in inflation," the Fed said.