27 June 2001, 22:22 Full text of FOMC statement
WASHINGTON (AFX) - The full text of the Federal Open Market
Committee follows:
The Federal Open Market Committee at its meeting today decided to
lower its target for the federal funds rate by 25 basis points to 3-3/4
percent. In a related action, the Board of Governors approved a 25
basis point reduction in the discount rate to 3-1/4 percent. Today's
action by the FOMC brings the decline in the target federal funds rate
since the beginning of the year to 275 basis points.
The patterns evident in recent months--declining profitability and
business capital spending, weak expansion of consumption, and slowing
growth abroad--continue to weigh on the economy. The associated easing
of pressures on labor and product markets are expected to keep
inflation contained.
Although continuing favorable trends bolster long-term prospects
for productivity growth and the economy, the Committee continues to
believe that against the background of its long-run goals of price
stability and sustainable economic growth and of the information
currently available, the risks are weighted mainly toward conditions
that may generate economic weakness in the foreseeable future.
In taking the discount rate action, the Federal Reserve Board
approved requests submitted by the Boards of Directors of the Federal
Reserve Banks of Boston, New York, Philadelphia, Atlanta, Chicago,
Dallas and San Francisco.
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