The FOMC left rates unchanged, as expected and the statement had a more constructive tone. Near-term risks to the economic outlook previously were "diminished" but have been upgraded to "appear roughly balanced". In addition, growth of economic activity has now "picked up from the modest pace seen in the first half of this year" -- a bit more upbeat as we head into year-end and increasing expectations of a rate-hike. There were three dissenters -- a fairly big disagreement and further hint of a nearing policy move -- this certainly keeps a December move in play. As for the Fed's forecasts, Fed Funds were taken down across the board with 2016 now at 0.6% (1 hike) and 2017 at just 1.1%. The long-run funds rate was also lowered to 2.9% from 3.0% -- continuing to imply a lowered terminal rate. Growth and inflation estimates were moved slightly lower, but nothing dramatic.
No one really expected a rate hike this close to the election.