At today's meeting of the Federal Open Market Committee, the federal funds rate target was raised to a range of 1.50%-1.75% from 1.25%-1.50%. The financial markets had expected today's action as indicated in the Action Economics Forecast Survey. The minutes to today's meeting stated, "The Committee expects that economic conditions will evolve in a manner that will warrant further gradual increases in the federal funds rate."

The Fed's statement following the meeting began by focusing on how labor market strengthening has been accompanied by growing consumer and business investment, although the latter have moderated recently. At the same time, real GDP growth has picked up to 2.92% during the last three quarters versus 1.84% during all of 2016.

Price inflation, both total and excluding food & energy, has been below 2%. The Fed indicated that, while remaining low, market-based measures of inflation recently have increased. In fact, growth in the core CPI has accelerated during the last three and six months (see chart below).

Economic projections were strengthened. Real GDP growth estimates of 2.7% in 2018, 2.4% in 2019 and 2.0% in 2020 were raised from 2.5%, 2.1% and 2.0%, respectively. Core PCE price inflation estimates were changed to 1.9% in 2018, 2.1% in 2019 and 2.1% in 2020 from 1.9%, 2.0% and 2.0%, respectively. The projected unemployment rate was lowered to 3.8% in 2018, 3.6% in 2019 and 3.6% in 2020 from 3.9%, 3.9% and 4.0%, respectively.

The press release for today's FOMC meeting can be found here.

Haver's SURVEYS database contains the economic projections from the FOMC.