Monetary policy FOMC members’ judgments that the pace of the economic recovery over coming quarters will likely remain moderate, that the unemployment rate will consequently decline only gradually, and that inflation will subside are the basis for the Committee’s decision to maintain a highly accommodative monetary policy. As you know, that policy currently consists of two parts.
First, the target range for the federal funds rate remains at 0 to 1/4 percent and, as indicated in the statement released after the June meeting, the Committee expects that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period.