FOMC holds rates steady, markets rise modestly
TLT•The Federal Reserve held its benchmark rate at 3.75%-4% in a 10-2 vote, while describing economic activity as strong and inflation as elevated. US stock indexes rose 0.2% after the decision, and the Fed said it would reduce its policy-meeting schedule starting next year.
1. Rates held steady
The Federal Reserve kept its benchmark interest rate in the 3.75%-4% range in a 10-2 decision, saying it wanted more information on inflation. The Fed upgraded its assessment of economic activity from “solid” to “strong” and said inflation remains elevated. Governors Lisa Cook and Cleveland Fed President Beth Hammack dissented in favor of a quarter-percentage-point hike.
2. Markets and outlook
US stock indexes rose 0.2% after Fed Chair Kevin Warsh began speaking. The Fed also said it would reduce its policy-meeting schedule starting next year. Some analysts expected a December rate hike, while others said the Fed’s decision and comments left the timing uncertain.
