FOMC Excerpt: Added "Further" Due To Improved Conditions>

     WASHINGTON (MNI) - The following are selected excerpts from the 

Federal Open Market Committee minutes of the January 30-31 meeting, 

published Wednesday: 

     Members expected that, with further gradual adjustments in the 

stance of monetary policy, economic activity would expand at a moderate 

pace and labor market conditions would remain strong. In their 

discussion of the economic outlook, most members viewed the recent data 

bearing on real economic activity as suggesting a modestly stronger 

near-term outlook than they had anticipated at their meeting in 

December. In addition, financial conditions had remained accommodative, 

and the details of the tax legislation suggested that its effects on 

consumer and business spending  while still uncertain  might be a bit 

greater in the near term than they had previously thought. Although 

several saw increased upside risks to the near-term outlook for economic 

activity, members generally continued to judge the risks to that 

outlook as remaining roughly balanced. 

--

     Members expected that economic conditions would evolve in a manner 

that would warrant further gradual increases in the federal funds rate. 

They judged that a gradual approach to raising the target range would 

sustain the economic expansion and balance the risks to the outlook for 

inflation and unemployment. Members agreed that the strengthening in the 

near-term economic outlook increased the likelihood that a gradual 

upward trajectory of the federal funds rate would be appropriate. They 

therefore agreed to update the characterization of their expectation 

for the evolution of the federal funds rate in the postmeeting statement 

to point to further gradual increases while maintaining the target 

range at the current meeting. Members continued to anticipate that the 

federal funds rate would likely remain, for some time, below levels that 

were expected to prevail in the longer run. Nonetheless, they again 

stated that the actual path for the federal funds rate would depend on 

the economic outlook as informed by the incoming data. 

     ** MNI Washington Bureau: (202)371-2121 ** 

[TOPICS: MMUFE$,M$U$$$,MT$$$$]