Uptick in incoming data not enough to sway the Fed

Since the Fed signalled at the last FOMC meeting three weeks ago that it was poised to act, the incoming economic data have, somewhat ironically, suddenly started to improve. Despite the recent uptick, however, the Fed is still not making any progress towards its primary goal which, with inflation contained, is getting the unemployment rate back down to a more normal level. On balance, we suspect that more action is still coming, although it is far from a done deal and the Fed could still pursue other options rather than restart quantitative easing again.