The Federal Open Market Committee decided today to raise its target for the federal funds rate by 25 basis points to 2-1/4 percent.
As expected. The official take on the economy has not budged an inch.
Output appears to be growing at a moderate pace despite the earlier rise in energy prices, and labor market conditions continue to improve gradually. Inflation and longer-term inflation expectations remain well contained...
With underlying inflation expected to be relatively low, the Committee believes that policy accommodation can be removed at a pace that is likely to be measured.
In other news, the Federal Reserve released the November statistics on industrial production and capacity utilization. This comes from SmartMoney.com:
U.S. industrial output grew at a slower pace November in line with market expectations, while capacity utilization edged up slightly during the month, the Federal Reserve said Tuesday.
Industrial production rose 0.3% last month, half the rate of growth in October, which was revised to 0.6% from the previously reported 0.7%. September industrial production was also revised down to a 0.1% decrease from the previously reported 0.1% rise.
November manufacturing rose in line with the overall production rate, while utilities production fell and mining rose at a faster pace.
We'll wrap up the day's reactions to today's news later.