WASHINGTON - The Federal Reserve Open Market Committee saw economic activity “picking up as anticipated” when it met on Nov. 3-4, according to minutes from the meeting released today.
Weak labor conditions and a limited threat of inflation were “likely to warrant exceptionally low rates for an extended period,” the minutes said.
With labor market conditions “somewhat weaker than anticipated, earlier declines in wealth still weighing on household balance sheets, and measures of consumer sentiment relatively low, the staff did not take much signal from the recent unexpected strength in spending and output,” according to the minutes.
Committee members reiterated the commitment to purchase $1.25 trillion of agency mortgage-backed securities by the end of the first quarter of 2010. Agency debt purchases will culminate at about $175 billion, $25 billion less than previously announced. The limited availability of the securities triggered the change, members said.
The committee also released economic projections with the minutes. Members now expect 2010 gross domestic product to grow between 2.5% and 3.5% at an annual rate. Members projected in June a range between 2.1% and 3.3% for GDP. The unemployment rate range for 2010 is 9.3% to 9.7%, members estimated, down from 9.5% to 9.8% estimated in June.
