00:00My colleagues and I remain squarely focused on achieving our dual mandate goals of maximum
00:04employment and stable prices for the benefit of the American people. The U.S. economy has
00:10been expanding at a solid pace. While job gains have remained low, the unemployment rate has
00:16been little changed in recent months, and inflation remains somewhat elevated. Today,
00:22the FOMC decided to leave our policy rate unchanged. We see the current stance of monetary policy as
00:29appropriate to promote progress toward our maximum employment and 2 percent inflation goals.
00:36The implications of developments in the Middle East for the U.S. economy are uncertain.
00:41We will remain attentive to risks to both sides of our dual mandate.
00:46And I'll have more to say about monetary policy after briefly reviewing economic developments.
00:53Available indicators suggest that economic activity has been expanding at a solid pace.
00:58Consumer spending has been resilient, and business-fixed investment has continued to expand.
01:04In contrast, activity in the housing sector has remained weak.
01:08In our summary of economic projections, the median participant projects that real GDP will rise 2.4 percent
01:15this year and 2.3 percent next year, somewhat stronger than projected in December.
01:22In the labor market, the unemployment rate was 4.4 percent in February, and has changed little since late last
01:29summer.
01:30Job gains have remained low.
01:33A good part of the slowing in the pace of job growth over the past year reflects a decline in
01:38the growth of the labor force
01:40due to lower immigration and labor force participation,
01:44though labor demand has clearly softened as well.
01:48Other indicators, including job openings, layoffs, hiring, and nominal wage growth,
01:54generally show little change in recent months.
01:57In our SEP, the median projection of the unemployment rate is 4.4 percent at the end of this year
02:03and edges down thereafter.
02:07Inflation has eased significantly from its highs in mid-2022 but remains somewhat elevated relative to our 2 percent longer
02:15-run goal.
02:16Estimates based on the Consumer Price Index and other data indicate that total PCE prices rose 2.8 percent
02:23over the 12 months ending in February,
02:25and that excluding the volatile food and energy categories, core PCE prices rose 3.0 percent.
02:33These elevated readings largely reflect inflation in the goods sector,
02:37which has been boosted by the effects of tariffs.
02:42Near-term measures of inflation expectations have risen in recent weeks,
02:46likely reflecting the substantial rise in oil prices caused by the supply disruptions in the Middle East.
02:52Most measures of longer-term expectations remain consistent with our 2 percent inflation goal.
02:59The median projection in the SEP for total PCE inflation this year is 2.7 percent and 2.2 percent
03:07next year,
03:08a bit higher than projected in December.
03:11Our monetary policy actions are guided by our dual mandate to promote maximum employment
03:16and stable prices for the American people.
03:19At today's meeting, the Committee decided to maintain the target range for the federal funds rate
03:24at 3.5 to 3.75 percent.
03:27From last September through December, we lowered our policy rate to 3.25 of a percentage point,
03:33bringing it within a range of plausible estimates of neutral.
03:36This normalization of our policy stance should continue to help stabilize the labor market
03:41while allowing inflation to resume its downward trend toward 2 percent.
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