MONETABRIEF – The US Federal Reserve kept its policy rate at 3.75 to 4.00 percent while inflation has matched its policy rate, claiming more information was needed, days ahead of mid term elections.
US consumer price inflation hit 3.6 percent in September, and is now at the level of its policy rate.
"Economic activity is expanding at a strong pace," the Federal Reserve said in a statement.
"While uncertainty remains elevated owing, in part, to geopolitical developments, domestic spending has been resilient.
"Productivity growth is strong, and capital investment is robust. Job gains have kept pace with the workforce, and the unemployment rate has changed little."
The Fed said it was keeping "ample reserves" or excess liquidity which critics say accommodates all supply shocks and inflates prices higher than countries with scarce reserve regimes.
"The Committee decided to maintain the target range for the federal funds rate at 3-3/4 to 4 percent, in support of the Federal Reserve's dual mandate," the statement said.
There was explanation why its inflation mandate was ignored if jobs growth was already strong except to say that it was kicking the can down the road looking for more information.
"Inflation remains elevated," the Fed said. "The accumulation of more information will help the Committee determine the policy stance appropriate to ensure a timely return of inflation to the Committee's 2 percent goal."
"The Committee will deliver price stability," repeating claims made earlier, which inflation continue to persist. (Colombo/Oct29/2026)