FOMC kept federal funds rate unchanged at 0-0.25% as widely expected. Additionally, Fed will continue with asset purchases “at least at the current pace”. Also, the committee would be “prepared to adjust the stance of monetary policy as appropriate”.

In line with the new “average inflation targeting”, Fed said: “With inflation running persistently below this longer-run goal, the Committee will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer-term inflation expectations remain well anchored at 2 percent.”

Dallas Fed President Robert Kaplan dissented, preferring to retain “greater policy rate flexibility”. Minneapolis Fed President Neel Kashkari dissented in favor of waiting for a rate hike until “core inflation has reached 2% on a sustained basis.”

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Full statement here.

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