That omission marked a softening in tone compared to the Fed’s statement last month.
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Among other precious metals, silver was up 0.3 percent at $15.88 an ounce, while platinum was down 0.6 percent at $987.90 an ounce, and palladium was down 0.3 percent at $677.15 an ounce.
Investors had expected the Fed to remain pat on rates, but the overt reference to December came as a surprise. A rate hike is considered off the table for now, but the communique will be scrutinized for clues about the future.
In a statement released Wednesday by the Fed, the FOMC members said that in an effort to “support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that the current 0 to 1/4% target range for the federal funds rate remains appropriate”.
“Nonetheless, labor market indicators, on balance, show that underutilization of labor resources has diminished since early this year”, the statement said.
“The on-and-off debate about when to raise interest rates has been adding to market uncertainties”, said Sung Won Sohn, an economics professor at California State University, Channel Islands.
Though analysts say a rate hike at the central bank’s next meeting in December is possible, two key Fed officials have called even that prospect into question.
While a rate increase has been long-awaited, a hike nevertheless raises the prospects of higher costs of capital and weaker emerging-market currencies around the world.
Traders have adjusted their expectations, with a CME futures gauge now putting the most likely chance for a hike in March 2016.
A few economists are certainly feeling more emboldened by their December rate-hike calls.
Now that unemployment has fallen to 5.1 percent, officials are anxious about inflation that is so low it threatens to drop into a cycle of falling prices and wages called deflation that could dry up demand and hurt the economy.
But Lacker was outnumbered then by his more dovish colleagues, who ultimately led America’s central bank to take a wait-and-see approach to interest rates rather than potentially act prematurely.
In its statement, the Fed repeated it wants to be “reasonably confident” that low inflation will rise to its 2% target.
Stock indexes are slightly higher Wednesday morning while several individual companies were making big moves on earnings and deal news.
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Of critical importance to markets is that a decision to raise interest rates for the first time in nearly 10 years is now more of a “live” possibility at the Fed’s next policy meeting, in December.
