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There was some argument and disagreement, but there were no surprises from Federal Reserve policy-makers today. After a two day meeting in Washington, they renewed their pledge to keep benchmark interest rates low for a considerable time. As NPR's John Ydstie reports, the Fed still thinks the job market is not recovering quickly enough.
JOHN YDSTIE, BYLINE: There's been a growing argument among Fed policymakers about whether it's time to begin raising official interest rates. They've been held near zero since 2008 to stimulate the economy. But when the dust cleared today, the pledge to keep rates low for a considerable time was still there. There were two dissenters on the Fed policy-making committee. They argued that the strength of the economy suggests rates should rise sooner than that language implies. In a post-meeting news conference, Fed Chair Janet Yellen seemed unfazed. She said it's natural to have a range of opinion on a matter as important as one to start raising rates.
JANET YELLEN: I think they perhaps have some concerns that if we don't begin to do so soon that inflation will pick up. But the committee adopted today's statement by an overwhelming majority. And I don't consider the level of dissent to be surprising or very abnormal.
YDSTIE: Yellen made the case for holding rates lower longer by expanding on another important point the committee made in its statement - that the economy still suffers from, quote, "a significant underutilization of labor resources."
YELLEN: The labor market has yet to fully recover. There is still too many people who want jobs but cannot find them, too many who are working part-time but would prefer full-time work. And too many who are not searching for a job but would be if the labor market was stronger.
YDSTIE: Yellen once again insisted that the timing of a rise in interest rates is dependent on the performance of the economy. And today, members of the policy-making committee updated their forecasts for the economy. The consensus was that growth would be slightly slower this year and next. Still, the forecasts suggest that the first rise in interest rates is still likely to come around the middle of next year. While the U.S. economy is recovering, Europe's has stalled. Yellen was asked whether she's worried.
YELLEN: It is one of a number of a risk to the global economy. And we certainly hope that they will be successful in us seeing the pace of growth and inflation pick up.
YDSTIE: The stock market, which has benefited from a policy of low rates, liked what it heard from Yellen today. The Dow closed at a record high. John Ydstie, NPR News, Washington. Transcript provided by NPR, Copyright NPR.
