Policymakers left unchanged its 2019 growth forecast at 2.1 percent; while revised higher to 2 for 2020, compared to 1.9 percent in the previous projection. The 2021 growth forecast remained unchanged at 1.8 percent. PCE inflation outlook was revised lower to 1.5 percent in 2019 (vs 1.8 percent in March projection); and to 1.9 percent in 2020 (vs 2 percent in March projection) while inflation for 2021 is seen at 2 percent (the same as in March projection). Meantime, unemployment is expected to average 3.6 percent in 2019 (vs 3.7 percent in March projection), 3.7 percent in 2020 (vs 3.8 percent) and 3.8 percent in 2021 (vs 3.9 percent).
Information received since the Federal Open Market Committee met in May indicates that the labor market remains strong and that economic activity is rising at a moderate rate. Job gains have been solid, on average, in recent months, and the unemployment rate has remained low. Although growth of household spending appears to have picked up from earlier in the year, indicators of business fixed investment have been soft. On a 12-month basis, overall inflation and inflation for items other than food and energy are running below 2 percent. Market-based measures of inflation compensation have declined; survey-based measures of longer-term inflation expectations are little changed.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. In support of these goals, the Committee decided to maintain the target range for the federal funds rate at 2-1/4 to 2-1/2 percent. The Committee continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective as the most likely outcomes, but uncertainties about this outlook have increased. In light of these uncertainties and muted inflation pressures, the Committee will closely monitor the implications of incoming information for the economic outlook and will act as appropriate to sustain the expansion, with a strong labor market and inflation near its symmetric 2 percent objective.
In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.