My colleagues and I remain squarely focused on achieving our dual mandate goals of maximum employment and stable prices for the benefit of the American people.

Available public and private sector data suggest that the outlook for employment and inflation has not changed as much since our meeting in October.

Conditions in the labor market appear to be gradually cooling and inflation remains somewhat elevated.

In light of the balance of risks to employment and inflation today, the Federal Open Market Committee decided to lower our policy interest rate by a quarter percentage point.

We also decided to initiate purchases of shorter-term Treasury securities solely for the purpose of maintaining an ample supply of reserves over time, thus supporting effective control of our policy rate.

Available indicators suggest that economic activity has been expanding at a moderate pace. Consumer spending appears to have remained solid, and business fixed investment has continued to expand.

In contrast, activity in the housing sector remains weak.

The temporary shutdown of the federal government has likely weighed on economic activity in the current quarter, but these effects should be mostly offset by higher growth next quarter, reflecting the reopening.

In our summary of economic projections, the median participant projects that real GDP will rise 1.7% this year and 2.3% next year, somewhat stronger than projected in September.

Available evidence suggests that both layoffs and hiring remain low, and that both households' perceptions of job availability and firms' perceptions of hiring difficulty continue to decline.

The official report on the labor market for September, the most recent release, showed that the unemployment rate continued to edge up, reaching 4.4%, and that job gains had slowed significantly since earlier in the year.

A good part of the slowing likely reflects a decline in the growth of the labor force due to lower immigration and labor force participation, though labor demand has clearly softened as well.

In this less dynamic and somewhat softer labor market, the downside risks to employment appear to have risen in recent months.

In our SEP, the median projection of the unemployment rate is 4.5% at the end of this year, and edges down thereafter.

Inflation has eased significantly from its highs in mid 2022, but remains somewhat elevated relative to our 2% longer run goal.

Total PCE prices rose 2.8% over the 12 months ending in September, and excluding the volatile food and energy categories, core PCE prices also rose 2.8%.

These readings are higher than earlier in the year as inflation for goods has picked up, reflecting the effects of tariffs. In contrast, disinflation appears to be continuing for services.

Near-term measures of inflation expectations have declined from their peaks earlier in the year, as reflected in both market and survey-based measures.

Most measures of longer-term expectations remain consistent with our 2% inflation goal.

The median projection in the SEP for total PCE inflation is 2.9% this year and 2.4% next year, a bit lower than the median projection in September, thereafter at the median falls to 2%.