United States Gross Domestic Product “GDP” advanced an annualized 3.50 percent in the third quarter of 2014. Real personal consumption expenditures improved 1.8 percent, durable goods increased 7.2 percent and nondurables increased 1.1 percent. Real federal government consumption expenditures and gross investment rose 10 percent during the third quarter. Private inventories accounted for a subtraction of .57 percent from the third-quarter GDP.

The Federal Reserve made a decision to end its asset purchase program on October 29th. The Fed believes economic activity will continue to expand at a moderate pace, with labor market indicators and inflation moving toward acceptable mandate levels. Inflation in the near term will likely be held down by lower energy prices, however the likelihood of inflation running persistently below 2 percent has diminished somewhat since early this year. The Fed will maintain their existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities. This policy should maintain accommodative financial conditions. The Federal Reserve will remain data dependent as it assesses its interest rate policy moving forward. The Committee anticipates to maintain the 0 to ¼ percent target federal funds rate range for a considerable time following the end of its asset purchase program in October, especially if projected inflation continues to run below the Fed’s 2 percent long-term goal, and provided inflation expectations remain well anchored.