Nov. 1 (UPI) -- The Federal Reserve chose not to increase its benchmark interest rate Wednesday, stating hurricane-related disruptions likely won't have long-term effects on the economy.
The Federal Open Market Committee announced it will maintain its target range for the federal funds rate between 1 percent and 1.25 percent following its policy meeting.
"The stance of monetary policy remains accommodative, thereby supporting some further strengthening in labor market conditions and a sustained return to 2 percent inflation," the Fed said.
Citing information received since its last meeting in September, the FOMC stated the labor market has continued to strengthen and economic activity has been steadily rising despite Hurricanes Harvey and Irma.
The Fed noted that hurricanes caused a drop in payroll employment in September, but the unemployment rate declined further and household spending continued to grow moderately.
Inflation boosted as gasoline prices rose after the storm, but inflation in other areas remained muted.
"Hurricane-related disruptions and rebuilding will continue to affect economic activity, employment and inflation in the near term, but past experience suggests that the storms are unlikely to materially alter the course of the national economy over the medium term," the Fed said.
A rate increase of a quarter-point is expected at the Fed's meeting in December.
"The committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run," the statement read.