Fed maintains current policy based on new economic data

By Sarah Robinson/NEMS Daily Journal

Data on key economic indicators was released Wednesday and a report from the board of the Federal Reserve indicated that its economic stimulus plan will remain unchanged in the short term.
New construction spending numbers for March 2013 from the U.S. Department of Commerce showed a slight decline from February but a 4.8 percent increase from March 2012.
Construction spending in March 2013 was estimated at $856.7 billion, down 1.7 percent from $871.2 billion in February. The March number is an improvement over the same time in the past two years, up from $817.8 billion in 2012 and $762.5 billion in 2011.
Spending levels remain steeply lower than in 2007 prior to the housing market. The March 2007 rate of spending topped $1.16 trillion.
The ADP National Employment Report revealed 119,000 non–farm jobs were added in April, the lowest addition in seven months. ADP, a private payroll processing firm, produces the report in collaboration with Moody’s Analytics based on actual payroll data.
The ADP report showed 113,000 service jobs were added, while good–producing jobs increased only slightly 6,000. The report also showed a loss of 10,000 manufacturing jobs. The Federal Reserve issued a statement after a meeting of its board and announced that it will maintain currently low interest rates until the national unemployment rate falls below 6.5 percent. According to the Bureau of Labor Statistics, the national unemployment rate for March 2013 was 7.6 percent.
The board of the Federal Reserve also said that it will continue to purchase mortgage–backed securities at a rate of $40 billion per month and Treasury backed securities at a rate of $45 billion per month.