Although Federal Reserve officials determined that economic activity is expanding moderately, the housing sector has shown additional improvement, and job gains have been solid with declining unemployment, the federal funds rate will remain the same at a target range of 0 to one-fourth percent, according to the Federal Open Market Committee July meeting. No specific timeline of when the federal funds rate would be raised was provided at the meeting.
The Committee also determined that labor market indicators found that underutilization of labor resources have diminished slightly, and growth in household spending has been moderate, while the housing sector showed some improvement. The Committee noted that it will assess both realized and expected progress in determining how long to maintain the near zero target range toward its maximum employment and 2 percent inflation objectives. The assessment will consider labor market conditions, inflation indicators, and financial and international developments.
For the first time in 2015, pending home sales declined in June, slowing momentum in the height of the homebuying summer season, according to the National Association of Realtors' Pending Home Sales Index. The index found that pending home sales fell 1.8 percent to 110.3 in June but is still 8.2 percent above the June 2014 level of 101.9. Although the index decreased last month, it is still the third highest reading this year and has increased year-over-year for ten consecutive months.