No change from the Federal Reserve, as expected

As widely expected, the FOMC opted to leave the Fed funds rate in the range of 1.00% to 1.25%.

  • Economic activity rising at "solid rate" despite storms
  • Labor market continues to strengthen (same as prior)
  • Inflation remains soft even though gasoline price rises after hurricanes boosted inflation
  • Measures of longer-term inflation expectations little changed
  • Balance sheet taper continuing
  • Household spending has been expanding at a moderate rate
  • Growth in business fixed investment has picked up in recent quarters

There were no changes whatsoever in the paragraph on guidance.

The big change is the economic activity has been increasing at a "solid rate" compared to "rising moderately". That's upbeat but the market, evidently, wanted a bit more. USD/JPY has dipped down to 113.80 from 114.00 beforehand.

I don't see much of a chance of a continued decline, this is still upbeat and a December hike is still overwhelmingly likely. Plus a tax cut plan is coming tomorrow.

Here is the redline. The parts after this were unchanged.