NEW: Fed removes 'patient' from policy statement

March 18, 2015

WASHINGTON (3/18/15, UPDATED 2:25 p.m. ET)--The Federal Open Market Committee (FOMC) has not yet seen enough out of the economy to raise short-term interest rates, but, perhaps signaling a forthcoming rate hike, dropped the word "patient" from the policy statement released at the conclusion of its two-day meeting today.

Still, the committee said that raising rates from their near-zero levels at its April meeting remains "unlikely."

"The committee anticipates that it will be appropriate to raise the target range for the federal funds rate when it has seen further improvement in the labor market and is reasonably confident that inflation will move back to its 2% objective over the medium term," the FOMC said. "This change in the forward guidance does not indicate that the committee has decided on the timing of the initial increase in the target range."

When the committee does decide to begin policy accommodation, or raise interest rates, it said it would take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2%.

Though, the FOMC said it anticipates that even after employment and inflation reach those levels, economic conditions may continue to warrant keeping interest rates below normal levels in the longer run.

The committee also reported that the information it has received since January suggests that U.S. economic growth has moderated somewhat.

Labor market indicators have improved, while the housing recovery continues to make slow progress.

"Inflation has declined further below the committee's longer-run objective, largely reflecting declines in energy prices," the FOMC said.