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Fed Announces Moderate Expansion of Economic Activity
Tuesday, December 23, 2014 6:45 AM

On Dec. 17, the Federal Reserve released a statement announcing that economic activity is expanding at a moderate pace. In their release, the Fed said Labor market conditions are continuing to improve with solid job gains and a lower unemployment rate.

On balance, a range of labor market indicators suggests that underutilization of labor resources continues to diminish. Household spending is rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow.

Inflation has continued to run below their longer-run objective, partly reflecting declines in energy prices. Market-based measures of inflation compensation have declined somewhat further; survey-based measures of longer-term inflation expectations have remained stable.

Expectations are that inflation will rise gradually toward 2 percent as the labor market improves further and the transitory effects of lower energy prices and other factors dissipate.

For more on the Fed's report, visit the Federal Reserve website.