All Federal Reserve banks felt the discount rate should remain at 1.75%, given “soft” inflation levels, according to the minutes of the discount rate meeting, released Tuesday.
“Given recent soft readings on inflation, they judged that it would be appropriate to maintain the current stance of monetary policy for the time being and to assess whether incoming data support the current outlook for continued moderate economic growth, some further strengthening in labor market conditions, and a gradual return of inflation to 2 percent over the medium term,” the minutes note.
The Board's also renewed “the existing formulas for calculating the rates applicable to discounts and advances under the secondary and seasonal credit programs for all twelve Reserve Banks.” The rate will be 50 basis points above the primary credit rate.
