Investing.com - The Federal Reserve said the case for a rate hike by the end of the year remains in place as it held steady as expected on on Wednesday, adding few tweaks to its statement that was seen by some as still short of a very strong signal.
The policymaking Federal Open Market Committee voted 8 to 2 to continue targeting the 0.25% to 0.50% range for the fed funds rate, where it has been since liftoff last December.
Kansas City Fed President Esther George and Cleveland Fed President Loretta Mester again dissented in favor of an immediate 25 basis point increase, while September's third dissenter, Boston Fed's more moderate Eric Rosengren, rejoined the majority.
The committee's statement said: the case for raising federal funds rate "continued to strengthen," even as it decided once more to wait "for the time being" for "some further evidence" of continued progress toward its goals.
The central bank also issued an upbeat assessment of economic conditions, especially in regard to inflation, which "has increased somewhat" since earlier
this year but is still below the Committee's 2% longer-run objective, and market-based measures of inflation compensation have "moved up."
To be sure, market reactions to the results of next week's presidential election and nonfarm payrolls data on Friday remain factors for December, anlayst said, noting the Fed is trying to walk a fine line. On the one hand, it wants to raises rates to head off the risk of the economy overheating, leading to higher inflation or even another recession. But if it moves too quickly,
it risks undermining the current tepid recovery and may be forced to backtrack.