Highlights
The Federal Open Market Committee kept the target for the federal funds rate unchanged at 5-1/4 percent and retained its anti-inflation bias. The vote was 10 to 0 in favor of no change. There were almost no changes in the wording in the statement other than marginal changes to reflect the latest economic data. The Fed acknowledged that "economic growth slowed" in the first part of the year instead of the March 21 comment that "recent indicators have been mixed." The current and previous statement recognized that the "adjustment in the housing sector is ongoing." The wording on inflation is essentially unchanged-stating "core inflation remains somewhat elevated," as was similarly cited in the prior statement "recent readings on core inflation have been somewhat elevated." The May 9 statement retained the identical text that inflation is the main concern.

"Although inflation pressures seem likely to moderate over time, the high level of resource utilization has the potential to sustain those pressures. In these circumstances, the Committee's predominant concern remains the risk that inflation will fail to moderate as expected. Future policy adjustments will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information."

The bottom line is that the Fed has shown no movement at all in terms of its concern that inflation is remaining too high. With no change of consequence in the Fed's statement, rate cuts are probably being nudged further out a little.

On the news, U.S. equities dipped slightly while rates on Treasury notes and bonds edged up 2 to 4 basis points.

2007 Release Schedule

Released On: 1/31 3/21 5/9 6/28 8/7 9/18 10/31 12/11 Released For: Dec Feb Apr May Jul Aug Sep Nov