Central bank says economy has been rising ‘at a solid rate despite hurricane-related disruptions’
The Federal Reserve held interest rates steady Wednesday but signaled a December rate hike remains on track.
Following the conclusion of a two-day meeting, members of the Federal Open Market Committee (FOMC) voted unanimously to maintain interest rates in a target range of 1.00-1.25 percent.
The FOMC said U.S. economic activity was “rising at a solid rate” compared with "rising moderately" in its September meeting statement.
It said information received since the September meeting indicates that "the labor market has continued to strengthen and that economic activity has been rising at a solid rate despite hurricane-related disruptions”.
Investors say the change in wording suggests the Fed has confidence now in the well-being of the U.S. economy and is ready to raise rates at its final meeting of the year on Dec. 12-13.
The probability of a December rate hike has risen to 97.7 percent, with the central bank likely to increase its benchmark interest rate by 25 basis points on Dec. 13, according to the CME FedWatch Tool.
The FOMC meeting, however, has been overshadowed by who will lead the Fed next.
Janet Yellen, the bank's current chair, is widely expected not to be reappointed after her term expires in February.
President Donald Trump will announce the new head of the Federal Reserve on Thursday.
Current Federal Reserve Board of Governors member Jerome Powell is considered the lead candidate for the job.