gtfintechlab/fomc_communication · Datasets at Hugging Face

index int64 0 1.13k	sentence stringlengths 13 1.05k	year int64 2k 2.02k	label int64 0 2	orig_index int64 0 1.07k
1,094	While recognizing the improvement in a number of indicators of economic activity and labor market conditions since the fall, many members indicated that further improvement in the outlook for the labor market would be required before it would be appropriate to slow the pace of asset purchases.	2,004	0	1,034
1,129	Yields on nominal Treasury coupon securities declined over the intermeeting period while yields on inflation-indexed Treasury securities were roughly unchanged, which left inflation compensation noticeably lower.	2,013	0	1,067
357	In the Committee's discussion of current and prospective economic developments, members commented that the statistical and anecdotal information that had become available since the October meeting continued to point to robust growth in overall economic activity, despite some indications of softening in interest-sensitive sectors of the economy.	1,997	1	342
706	Stimulus checks put money in people's pockets, and when they spend it, there will be upward pressure on prices.	2,006	1	685
309	In any case, however, the assessment of the adverse effects of the increase in longer-term rates on financial conditions and ultimately on economic activity would depend importantly upon the extent to which rates stabilized at current levels or instead continued to rise.	2,017	2	294
987	When interest rates increase, prices will undoubtedly adjust to some extent--in some cases simply by rising less rapidly than they would otherwise--and debt-service obligations will move up.	2,007	1	958
695	Participants' Views on Current Conditions and the Economic Outlook In conjunction with this FOMC meeting, meeting participants--the 7 members of the Board of Governors and the presidents of the 12 Federal Reserve Banks, all of whom participate in the deliberations of the FOMC--submitted their assessments of real output growth, the unemployment rate, inflation, and the target federal funds rate for each year from 2013 through 2015 and over the longer run, under each participant's judgment of appropriate monetary policy.	2,012	2	660
137	Besides influencing the near-term course of important economic variables, such as gross domestic product growth, inflation, and profits, productivity largely determines our society's long-term economic welfare.	2,000	2	135
521	January 13, 2021 Full Employment in the New Monetary Policy Framework Governor Lael Brainard At the Inaugural Mike McCracken Lecture on Full Employment Sponsored by the Canadian Association for Business Economics (via webcast) Share I want to thank the Canadian Association for Business Economics for inviting me to join you today, particularly president Bonnie Lemcke and past president Armine Yalnizyan.	2,004	2	504
858	also by views about how fiscal policy might adjust to monetary policy.	2,008	2	832
42	All members agreed that the FOMC statement for this meeting should again indicate that policy accommodation could be removed at a pace that was likely to be measured but that the Committee would respond to changes in economic prospects as needed to maintain price stability.	1,997	1	42
1,037	They continued to expect that inflation would move up toward the Committee's 2 percent objective over the medium term as the effects of these transitory factors waned and conditions in the labor market improved further.	2,017	2	979
628	One of Dick Porter's many contributions was to develop a monetary approach to forecasting inflation at medium-term horizons.	2,001	2	608
605	Now suppose that, in an economy experiencing a stable deflation, the central bank leadership announces a fixed inflation target but then makes no progress toward that target during a given period.	2,005	2	586
1,100	With appropriate firming in the stance of monetary policy, participants expected inflation to return to the Committee's 2 percent objective over time and the labor market to remain strong.	2,020	1	1,040
118	Both of these views would suggest a lower level of potential output and thus reduced scope for combating unemployment with additional monetary policy stimulus.	2,011	0	115
62	As I mentioned, once you—once you’re, broadly speaking, in the range of neutral, I think it’s appropriate to be putting aside individual estimates of that and be looking at what the incoming data are telling you about the outlook, updating your estimates of what neutral might be, of what the natural rate of unemployment might be, of the state of the economy, so—and letting that lead you to adjust your outlook and, therefore, your appropriate path for policy.	2,018	2	61
109	with a healthy job market, rising incomes, and upbeat consumer confidence, the fundamentals supporting household spending are solid.	2,013	2	105
444	the prices of some key commodities had increased recently.	2,016	1	425
320	Going forward, the question is not only whether inflation will fall in the coming months,	1,998	2	312
331	His conclusion is that only by far-reaching decentralization in a market system with competition and free price-fixing is it possible to make full use of knowledge and information.	2,021	2	322
151	Consumer food prices were little changed in August.	2,006	2	148
870	The U. S. international trade deficit declined somewhat in May after reaching a record high in April.	2,010	2	821
668	Participants commented on the continued improvement in labor market conditions in recent months driven by strong demand for workers.	2,003	2	633
370	In the days immediately following the Brexit vote, asset prices were volatile, and some financial markets, particularly certain foreign exchange markets, experienced brief periods of strained liquidity.	2,010	2	355
860	The Committee's assessments will take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments. "	2,004	2	811
611	first, please allow me to offer a few remarks on the economic outlook, Federal Reserve monetary policy, and some of the initiatives we have announced to support the flow of credit to households and firms during these challenging times.	2,020	0	591
39	And then we’ll look to have that just running in the background and have—and have the interest rates, again, be the active tool of monetary policy.	2,022	2	39
437	In practice, the Fed operates through a committee structure and considers the recommendations of a variety of monetary rules as we make monetary policy decisions.	2,005	2	424
375	In the household sector, the rise in home mortgage debt likely slowed a bit further in the first quarter, as home-price appreciation appeared to have remained sluggish.	2,009	2	360
174	Data received over the intermeeting period reinforced earlier indications that real GDP growth had turned up after having been slow in the first quarter of this year.	2,016	2	168
1,028	These participants stated that, in such circumstances, a major challenge facing policymakers—especially in the presence of the effective lower bound on the federal funds rate—was to maintain a policy stance sufficiently accommodative to keep average inflation at 2 percent and thereby bolster the credibility of the Committee's new policy framework, facilitating the achievement of both maximum employment and price stability.	2,007	0	970
1,046	This action was taken against the backdrop of heightened concerns and uncertainty created by the recent terrorist attacks and their potentially adverse effects on asset prices and the performance of the economy.	2,015	0	986
21	A majority of FOMC participants indicated that they expect core inflation to remain below our 2 percent objective and employment to fall short of its maximum level at least through the end of 2022.	2,004	0	20
813	The reduced-form price equations we so often use for inflation prediction bypass direct contact with labor compensation issues.	2,007	2	790
908	Through our business contacts, we continue to hear stories about bottlenecks at almost every stage of production and distributionâ€”for example, plants that shut down because of a shortage of one or more crucial inputs; a poor cotton crop in the United States due to weather, which is driving up prices; and clogged ports and trucker shortages.	2,007	1	881
708	Stock prices and existing home sales are somewhat correlated, a not altogether unexpected result, because each is affected by interest rates and presumably the gains from each help finance the other.	2,006	2	687
770	The distortions in the markets I have reviewed do not appear all that large, given the stance of monetary policy, and should we experience much higher interest rates and softer asset prices our resilient markets and flexible economy probably could absorb such a shock.	2,004	1	748
160	Consumer sentiment was at or close to historically high levels according to recent surveys, evidently reflecting the strong uptrend in employment and income and to some extent the very large cumulative increase in stock market wealth over the course of recent years.	2,014	1	156
541	Members commented that added fiscal stimulus might prove to be a useful complement to an accommodative monetary policy in the period immediately ahead when economic activity was likely to remain below the economy's potential.	2,009	0	512
665	Prospects for ProductivityLet me close with some comments on the outlook for productivity.	2,000	2	644
92	As a result, consistent with the policy implication of Bill's 1970 model, the Federal Reserve (like most other central banks) today uses the overnight interbank rate as the principal operating target of monetary policy.	2,004	2	91
102	During this time of reopening, we are likely to see some upward pressure on prices, and I’ll discuss why.	2,017	0	98
211	For now, the Committee should remain particularly vigilant to incoming information bearing on the outlook for inflation.	2,007	2	202
1,021	Without the oil shock, policymakers beginning from a period of low interest rates would try to keep the economy on an even growth path as they gradually raised nominal interest rates.	1,999	1	989
282	For example, households have been able with increasing ease to extract equity from their homes, and this doubtless has helped support consumer spending in recent years, complementing the traditional effects of monetary policy.	2,004	2	276
950	Under pure monetary targeting, interest rates would fluctuate with shocks in spending.	2,000	2	921
992	The staff viewed the uncertainty around the forecast for economic activity as similar to its normal level over the past 20 years.	2,021	2	935
342	However, in this framework, the current period appears to be an outlier.4 That is, even after factoring in the current-cycle dynamics of strong profit growth and relatively modest investment, a good part of the rise in liquid assets remains unaccounted for--as much as one half of the total rise in cash-to-assets--according to Federal Reserve staff estimates.	2,004	2	333
350	However, we also believe now is a good time to step back and assess whether, and in what possible ways, we can refine our strategy, tools, and communication practices to achieve and maintain our goals as consistently and robustly as possible.2 With the U.S. economy operating at or close to maximum employment and price stability, now is an especially opportune time to conduct this review.	2,006	2	341
699	Some evidence exists that quantitative easing can stimulate the economy even when interest rates are near zero; see, for example, Christina Romer's (1992) discussion of the effects of increases in the money supply during the Great Depression in the United States.	2,017	0	678
223	So, as you know, the ultimate focus that we have is on the real economy: maximum employment and price stability.	2,019	2	218
58	And, you know, we do want inflation to run moderately above 2 percent.	2,011	0	57
899	The explanations included a decline in inflation risk premiums, possibly reflecting a lower perceived probability of higher inflation outcomes	2,009	2	849
554	More broadly, signs of a pickup in growth in economic activity in some AFEs and emerging Asian economies other than China also appeared to contribute to the improvement in sentiment in financial markets.	2,018	2	525
188	Same thing with economic activity.	2,012	2	183
298	Well, if the economy worsens and inflation remains relatively low, then we wouldn’t begin to exit, and, therefore, we wouldn’t change the language.	2,020	0	291
710	inflation was projected to pick up gradually in association with a partial reversal of the decline in energy prices this year.	1,996	2	675
725	That is, monetary policy responds to changes in fiscal policy in much the same way that it responds to other influences on the economy, such as equity prices, exchange rates, or the demand for U.S. exports due to changed growth prospects abroad.	2,007	2	703
185	Central banks generally appear to have embraced a common model of the channels through which monetary policy functions, although the specifics and emphasis given to those channels vary according to our particular circumstances.	1,997	2	183
125	I would further say that I think it’s important to emphasize that we’re not going to mechanically take the interest rate projections that participants provide and just build policy off of that.	2,016	2	120
574	Moreover, the variance of GDP growth markedly lessened as inflation tumbled from its double-digit high in the early 1980s.	2,006	2	556
857	The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals.	1,998	2	808
144	In terms of the, you know, inflation, a couple things—your second question.	2,013	2	139
635	On the more positive side, there were no signs that the pace of productivity gains was currently leveling out and no evidence of rising longer-term inflation expectations.	2,001	2	602
334	How the forces of demand, potential supply, and expectations interact has probably not been changed in any fundamental way by the recent trend of globalization.	2,007	2	325
636	On the one hand, an inverted yield curve could indicate an increased risk of recession; on the other hand, the low level of term premiums in recent years--reflecting, in part, central bank asset purchases--could temper the reliability of the slope of the yield curve as an indicator of future economic activity.	2,001	0	603
458	It was possible, though, that investors' uncertainty regarding inflation prospects, not just inflation expectations themselves, had risen.	2,021	1	437
241	How long the favorable factors that continued to stimulate substantial growth in consumer expenditures would persist was uncertain, notably with regard to the outlook for stock market prices and their effects on consumer resources and willingness to spend.	1,996	2	232
505	It also requires that policy tighten or ease systematically to bring aggregate demand in line with the economy's productive potential, not only because output stabilization is a policy objective in its own right	2,020	1	488
923	The longer-run projections represent each participant's assessment of the rate to which each variable would be expected to converge, over time, under appropriate monetary policy and in the absence of further shocks to the economy.	2,010	2	873
309	Funding of our current account deficit likely will become more difficult when home bias approaches its practical minimum.	2,021	1	301
540	Members cited greater, albeit still occasional, indications of heightened worker demands in labor negotiations that likely were encouraged in part by ample job opportunities.	2,009	1	511
172	But what does this mean for monetary policy?	2,004	2	170
542	Members commented that the continued strong increases in energy and other commodity prices would prompt a difficult adjustment process involving both lower growth and higher rates of inflation in the near term.	2,009	2	513
962	The risks to the forecast for real GDP growth and inflation were seen as tilted to the downside, reflecting recent financial developments and concerns about the foreign economic outlook, as well as the staff's assessment that neither monetary policy nor fiscal policy appeared well positioned to help the economy withstand adverse shocks.	2,019	0	909
274	Wage inflation has been running at 2 percent.	2,021	2	268
479	Looking ahead, however, members reiterated earlier concerns that aggregate demand could continue to grow faster than potential aggregate supply, even under optimistic assumptions regarding future productivity gains.	2,019	1	458
192	So I think, through all of those channels, monetary policy works.	2,020	2	187
107	For example, the unemployment rate has risen by 0.3 percentage points since March, and new claims for unemployment insurance have moved somewhat higher.	2,021	0	103
399	In addition to u* and r*, an important input into any monetary policy assessment is the state of inflation expectations.	2,021	2	387
664	Participants also noted that unemployment insurance claims continued to run at a historically elevated level, but the proportion of laid-off workers who expected to be recalled was unusually large.	2,003	0	630
716	Projections of the rate of inflation, as measured by the consumer price index, had a central tendency of 1-3/4 to 2-1/4 percent, on the high side of the outcome for 1997 when the rise in the index was held down by damped increases in food prices and declines in energy prices.	2,005	2	680
862	The December employment report showed that job growth had slowed appreciably, and other indicators also pointed to emerging weakness in the labor market in the intermeeting period.	2,004	0	813
46	we have continued to analyze the effects of changes in interest rates, for example, on decisions like investment or car purchases.	2,022	2	46
940	The nominal deficit on U. S. trade in goods and services widened substantially in the second quarter.	2,016	1	888
645	One participant remarked that, with inflation having run consistently below 2 percent in recent years and market-based measures of inflation compensation still low, postponing an increase in the target range for the federal funds rate would help push inflation expectations up to levels consistent with the Committee's objective.	1,999	0	612
929	To reduce that uncertainty, we often use the unemployment gap rather than the output gap in these rules.19 We also need to pick values for the coefficients a and b, whether they are the values John Taylor posited in his seminal 1993 article or other values from the vast literature that has come since.20 There are still other choices to make.	2,003	2	901
429	In part, the high inflation reflects supply chain disruptions associated with the economic effects of the pandemic and efforts made to contain it.	2,006	1	416
1,126	With underlying inflation expected to be relatively low, the Committee believes that policy accommodation can be removed at a pace that is likely to be measured.	2,003	1	1,064
349	However, the volatility of these and other commodity prices is such that possible future increases in these prices remain a risk to the inflation outlook.	2,006	1	340
235	That’s not going to happen without, without restoring price stability.	2,016	1	230
592	Nevertheless, the path of inflation is the biggest risk to my outlook.	1,999	1	573
4	Again, while I do not shirk the responsibility of the Fed having to do what it can to meet its mandate, obviously, a broad range of policies can affect growth and employment, and I hope that there will be a range of actions that will complement and supplement the Federal Reserve’s efforts.	2,019	2	4
182	Developments in foreign trade were moderating demands on domestic resources	2,016	0	175
749	Risks to the inflation projection also were seen as balanced.	2,010	2	709
454	It was also noted that the weakness in homebuilding along with the continued rise in house prices suggested that supply constraints were also weighing on construction activity.	2,020	1	433
165	But that forecast for growth and uncertainty about the resolution of supply constraints mean that there are upside risks to inflation next year.	1,997	1	163
704	Participants' forecasts for economic growth for 2012 and 2013 were largely unchanged from their January projections and continued to indicate expectations that the recovery will strengthen somewhat over time.	1,999	2	669
1,055	Those factors included the increasing spread of the coronavirus in the United States since mid-June; the reactions of many states and localities in slowing or scaling back the reopening of their economies, especially for businesses, such as restaurants and bars, providing services that entail personal interactions; and some high-frequency indicators that pointed to a deceleration in economic activity.	2,000	0	995

1,094

While recognizing the improvement in a number of indicators of economic activity and labor market conditions since the fall, many members indicated that further improvement in the outlook for the labor market would be required before it would be appropriate to slow the pace of asset purchases.

2,004

0

1,034

1,129

Yields on nominal Treasury coupon securities declined over the intermeeting period while yields on inflation-indexed Treasury securities were roughly unchanged, which left inflation compensation noticeably lower.

2,013

0

1,067

357

In the Committee's discussion of current and prospective economic developments, members commented that the statistical and anecdotal information that had become available since the October meeting continued to point to robust growth in overall economic activity, despite some indications of softening in interest-sensitive sectors of the economy.

1,997

1

342

706

Stimulus checks put money in people's pockets, and when they spend it, there will be upward pressure on prices.

2,006

1

685

309

In any case, however, the assessment of the adverse effects of the increase in longer-term rates on financial conditions and ultimately on economic activity would depend importantly upon the extent to which rates stabilized at current levels or instead continued to rise.

2,017

2

294

987

When interest rates increase, prices will undoubtedly adjust to some extent--in some cases simply by rising less rapidly than they would otherwise--and debt-service obligations will move up.

2,007

1

958

695

Participants' Views on Current Conditions and the Economic Outlook In conjunction with this FOMC meeting, meeting participants--the 7 members of the Board of Governors and the presidents of the 12 Federal Reserve Banks, all of whom participate in the deliberations of the FOMC--submitted their assessments of real output growth, the unemployment rate, inflation, and the target federal funds rate for each year from 2013 through 2015 and over the longer run, under each participant's judgment of appropriate monetary policy.

2,012

2

660

137

Besides influencing the near-term course of important economic variables, such as gross domestic product growth, inflation, and profits, productivity largely determines our society's long-term economic welfare.

2,000

2

135

521

January 13, 2021 Full Employment in the New Monetary Policy Framework Governor Lael Brainard At the Inaugural Mike McCracken Lecture on Full Employment Sponsored by the Canadian Association for Business Economics (via webcast) Share I want to thank the Canadian Association for Business Economics for inviting me to join you today, particularly president Bonnie Lemcke and past president Armine Yalnizyan.

2,004

2

504

858

also by views about how fiscal policy might adjust to monetary policy.

2,008

2

832

42

All members agreed that the FOMC statement for this meeting should again indicate that policy accommodation could be removed at a pace that was likely to be measured but that the Committee would respond to changes in economic prospects as needed to maintain price stability.

1,997

1

42

1,037

They continued to expect that inflation would move up toward the Committee's 2 percent objective over the medium term as the effects of these transitory factors waned and conditions in the labor market improved further.

2,017

2

979

628

One of Dick Porter's many contributions was to develop a monetary approach to forecasting inflation at medium-term horizons.

2,001

2

608

605

Now suppose that, in an economy experiencing a stable deflation, the central bank leadership announces a fixed inflation target but then makes no progress toward that target during a given period.

2,005

2

586

1,100

With appropriate firming in the stance of monetary policy, participants expected inflation to return to the Committee's 2 percent objective over time and the labor market to remain strong.

2,020

1

1,040

118

Both of these views would suggest a lower level of potential output and thus reduced scope for combating unemployment with additional monetary policy stimulus.

2,011

0

115

62

As I mentioned, once you—once you’re, broadly speaking, in the range of neutral, I think it’s appropriate to be putting aside individual estimates of that and be looking at what the incoming data are telling you about the outlook, updating your estimates of what neutral might be, of what the natural rate of unemployment might be, of the state of the economy, so—and letting that lead you to adjust your outlook and, therefore, your appropriate path for policy.

2,018

2

61

109

with a healthy job market, rising incomes, and upbeat consumer confidence, the fundamentals supporting household spending are solid.

2,013

2

105

444

the prices of some key commodities had increased recently.

2,016

1

425

320

Going forward, the question is not only whether inflation will fall in the coming months,

1,998

2

312

331

His conclusion is that only by far-reaching decentralization in a market system with competition and free price-fixing is it possible to make full use of knowledge and information.

2,021

2

322

151

Consumer food prices were little changed in August.

2,006

2

148

870

The U. S. international trade deficit declined somewhat in May after reaching a record high in April.

2,010

2

821

668

Participants commented on the continued improvement in labor market conditions in recent months driven by strong demand for workers.

2,003

2

633

370

In the days immediately following the Brexit vote, asset prices were volatile, and some financial markets, particularly certain foreign exchange markets, experienced brief periods of strained liquidity.

2,010

2

355

860

The Committee's assessments will take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments. "

2,004

2

811

611

first, please allow me to offer a few remarks on the economic outlook, Federal Reserve monetary policy, and some of the initiatives we have announced to support the flow of credit to households and firms during these challenging times.

2,020

0

591

39

And then we’ll look to have that just running in the background and have—and have the interest rates, again, be the active tool of monetary policy.

2,022

2

39

437

In practice, the Fed operates through a committee structure and considers the recommendations of a variety of monetary rules as we make monetary policy decisions.

2,005

2

424

375

In the household sector, the rise in home mortgage debt likely slowed a bit further in the first quarter, as home-price appreciation appeared to have remained sluggish.

2,009

2

360

174

Data received over the intermeeting period reinforced earlier indications that real GDP growth had turned up after having been slow in the first quarter of this year.

2,016

2

168

1,028

These participants stated that, in such circumstances, a major challenge facing policymakers—especially in the presence of the effective lower bound on the federal funds rate—was to maintain a policy stance sufficiently accommodative to keep average inflation at 2 percent and thereby bolster the credibility of the Committee's new policy framework, facilitating the achievement of both maximum employment and price stability.

2,007

0

970

1,046

This action was taken against the backdrop of heightened concerns and uncertainty created by the recent terrorist attacks and their potentially adverse effects on asset prices and the performance of the economy.

2,015

0

986

21

A majority of FOMC participants indicated that they expect core inflation to remain below our 2 percent objective and employment to fall short of its maximum level at least through the end of 2022.

2,004

0

20

813

The reduced-form price equations we so often use for inflation prediction bypass direct contact with labor compensation issues.

2,007

2

790

908

Through our business contacts, we continue to hear stories about bottlenecks at almost every stage of production and distributionâ€”for example, plants that shut down because of a shortage of one or more crucial inputs; a poor cotton crop in the United States due to weather, which is driving up prices; and clogged ports and trucker shortages.

2,007

1

881

708

Stock prices and existing home sales are somewhat correlated, a not altogether unexpected result, because each is affected by interest rates and presumably the gains from each help finance the other.

2,006

2

687

770

The distortions in the markets I have reviewed do not appear all that large, given the stance of monetary policy, and should we experience much higher interest rates and softer asset prices our resilient markets and flexible economy probably could absorb such a shock.

2,004

1

748

160

Consumer sentiment was at or close to historically high levels according to recent surveys, evidently reflecting the strong uptrend in employment and income and to some extent the very large cumulative increase in stock market wealth over the course of recent years.

2,014

1

156

541

Members commented that added fiscal stimulus might prove to be a useful complement to an accommodative monetary policy in the period immediately ahead when economic activity was likely to remain below the economy's potential.

2,009

0

512

665

Prospects for ProductivityLet me close with some comments on the outlook for productivity.

2,000

2

644

92

As a result, consistent with the policy implication of Bill's 1970 model, the Federal Reserve (like most other central banks) today uses the overnight interbank rate as the principal operating target of monetary policy.

2,004

2

91

102

During this time of reopening, we are likely to see some upward pressure on prices, and I’ll discuss why.

2,017

0

98

211

For now, the Committee should remain particularly vigilant to incoming information bearing on the outlook for inflation.

2,007

2

202

1,021

Without the oil shock, policymakers beginning from a period of low interest rates would try to keep the economy on an even growth path as they gradually raised nominal interest rates.

1,999

1

989

282

For example, households have been able with increasing ease to extract equity from their homes, and this doubtless has helped support consumer spending in recent years, complementing the traditional effects of monetary policy.

2,004

2

276

950

Under pure monetary targeting, interest rates would fluctuate with shocks in spending.

2,000

2

921

992

The staff viewed the uncertainty around the forecast for economic activity as similar to its normal level over the past 20 years.

2,021

2

935

342

However, in this framework, the current period appears to be an outlier.4 That is, even after factoring in the current-cycle dynamics of strong profit growth and relatively modest investment, a good part of the rise in liquid assets remains unaccounted for--as much as one half of the total rise in cash-to-assets--according to Federal Reserve staff estimates.

2,004

2

333

350

However, we also believe now is a good time to step back and assess whether, and in what possible ways, we can refine our strategy, tools, and communication practices to achieve and maintain our goals as consistently and robustly as possible.2 With the U.S. economy operating at or close to maximum employment and price stability, now is an especially opportune time to conduct this review.

2,006

2

341

699

Some evidence exists that quantitative easing can stimulate the economy even when interest rates are near zero; see, for example, Christina Romer's (1992) discussion of the effects of increases in the money supply during the Great Depression in the United States.

2,017

0

678

223

So, as you know, the ultimate focus that we have is on the real economy: maximum employment and price stability.

2,019

2

218

58

And, you know, we do want inflation to run moderately above 2 percent.

2,011

0

57

899

The explanations included a decline in inflation risk premiums, possibly reflecting a lower perceived probability of higher inflation outcomes

2,009

2

849

554

More broadly, signs of a pickup in growth in economic activity in some AFEs and emerging Asian economies other than China also appeared to contribute to the improvement in sentiment in financial markets.

2,018

2

525

188

Same thing with economic activity.

2,012

2

183

298

Well, if the economy worsens and inflation remains relatively low, then we wouldn’t begin to exit, and, therefore, we wouldn’t change the language.

2,020

0

291

710

inflation was projected to pick up gradually in association with a partial reversal of the decline in energy prices this year.

1,996

2

675

725

That is, monetary policy responds to changes in fiscal policy in much the same way that it responds to other influences on the economy, such as equity prices, exchange rates, or the demand for U.S. exports due to changed growth prospects abroad.

2,007

2

703

185

Central banks generally appear to have embraced a common model of the channels through which monetary policy functions, although the specifics and emphasis given to those channels vary according to our particular circumstances.

1,997

2

183

125

I would further say that I think it’s important to emphasize that we’re not going to mechanically take the interest rate projections that participants provide and just build policy off of that.

2,016

2

120

574

Moreover, the variance of GDP growth markedly lessened as inflation tumbled from its double-digit high in the early 1980s.

2,006

2

556

857

The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals.

1,998

2

808

144

In terms of the, you know, inflation, a couple things—your second question.

2,013

2

139

635

On the more positive side, there were no signs that the pace of productivity gains was currently leveling out and no evidence of rising longer-term inflation expectations.

2,001

2

602

334

How the forces of demand, potential supply, and expectations interact has probably not been changed in any fundamental way by the recent trend of globalization.

2,007

2

325

636

On the one hand, an inverted yield curve could indicate an increased risk of recession; on the other hand, the low level of term premiums in recent years--reflecting, in part, central bank asset purchases--could temper the reliability of the slope of the yield curve as an indicator of future economic activity.

2,001

0

603

458

It was possible, though, that investors' uncertainty regarding inflation prospects, not just inflation expectations themselves, had risen.

2,021

1

437

241

How long the favorable factors that continued to stimulate substantial growth in consumer expenditures would persist was uncertain, notably with regard to the outlook for stock market prices and their effects on consumer resources and willingness to spend.

1,996

2

232

505

It also requires that policy tighten or ease systematically to bring aggregate demand in line with the economy's productive potential, not only because output stabilization is a policy objective in its own right

2,020

1

488

923

The longer-run projections represent each participant's assessment of the rate to which each variable would be expected to converge, over time, under appropriate monetary policy and in the absence of further shocks to the economy.

2,010

2

873

309

Funding of our current account deficit likely will become more difficult when home bias approaches its practical minimum.

2,021

1

301

540

Members cited greater, albeit still occasional, indications of heightened worker demands in labor negotiations that likely were encouraged in part by ample job opportunities.

2,009

1

511

172

But what does this mean for monetary policy?

2,004

2

170

542

Members commented that the continued strong increases in energy and other commodity prices would prompt a difficult adjustment process involving both lower growth and higher rates of inflation in the near term.

2,009

2

513

962

The risks to the forecast for real GDP growth and inflation were seen as tilted to the downside, reflecting recent financial developments and concerns about the foreign economic outlook, as well as the staff's assessment that neither monetary policy nor fiscal policy appeared well positioned to help the economy withstand adverse shocks.

2,019

0

909

274

Wage inflation has been running at 2 percent.

2,021

2

268

479

Looking ahead, however, members reiterated earlier concerns that aggregate demand could continue to grow faster than potential aggregate supply, even under optimistic assumptions regarding future productivity gains.

2,019

1

458

192

So I think, through all of those channels, monetary policy works.

2,020

2

187

107

For example, the unemployment rate has risen by 0.3 percentage points since March, and new claims for unemployment insurance have moved somewhat higher.

2,021

0

103

399

In addition to u* and r*, an important input into any monetary policy assessment is the state of inflation expectations.

2,021

2

387

664

Participants also noted that unemployment insurance claims continued to run at a historically elevated level, but the proportion of laid-off workers who expected to be recalled was unusually large.

2,003

0

630

716

Projections of the rate of inflation, as measured by the consumer price index, had a central tendency of 1-3/4 to 2-1/4 percent, on the high side of the outcome for 1997 when the rise in the index was held down by damped increases in food prices and declines in energy prices.

2,005

2

680

862

The December employment report showed that job growth had slowed appreciably, and other indicators also pointed to emerging weakness in the labor market in the intermeeting period.

2,004

0

813

46

we have continued to analyze the effects of changes in interest rates, for example, on decisions like investment or car purchases.

2,022

2

46

940

The nominal deficit on U. S. trade in goods and services widened substantially in the second quarter.

2,016

1

888

645

One participant remarked that, with inflation having run consistently below 2 percent in recent years and market-based measures of inflation compensation still low, postponing an increase in the target range for the federal funds rate would help push inflation expectations up to levels consistent with the Committee's objective.

1,999

0

612

929

To reduce that uncertainty, we often use the unemployment gap rather than the output gap in these rules.19 We also need to pick values for the coefficients a and b, whether they are the values John Taylor posited in his seminal 1993 article or other values from the vast literature that has come since.20 There are still other choices to make.

2,003

2

901

429

In part, the high inflation reflects supply chain disruptions associated with the economic effects of the pandemic and efforts made to contain it.

2,006

1

416

1,126

With underlying inflation expected to be relatively low, the Committee believes that policy accommodation can be removed at a pace that is likely to be measured.

2,003

1

1,064

349

However, the volatility of these and other commodity prices is such that possible future increases in these prices remain a risk to the inflation outlook.

2,006

1

340

235

That’s not going to happen without, without restoring price stability.

2,016

1

230

592

Nevertheless, the path of inflation is the biggest risk to my outlook.

1,999

1

573

4

Again, while I do not shirk the responsibility of the Fed having to do what it can to meet its mandate, obviously, a broad range of policies can affect growth and employment, and I hope that there will be a range of actions that will complement and supplement the Federal Reserve’s efforts.

2,019

2

4

182

Developments in foreign trade were moderating demands on domestic resources

2,016

0

175

749

Risks to the inflation projection also were seen as balanced.

2,010

2

709

454

It was also noted that the weakness in homebuilding along with the continued rise in house prices suggested that supply constraints were also weighing on construction activity.

2,020

1

433

165

But that forecast for growth and uncertainty about the resolution of supply constraints mean that there are upside risks to inflation next year.

1,997

1

163

704

Participants' forecasts for economic growth for 2012 and 2013 were largely unchanged from their January projections and continued to indicate expectations that the recovery will strengthen somewhat over time.

1,999

2

669

1,055

Those factors included the increasing spread of the coronavirus in the United States since mid-June; the reactions of many states and localities in slowing or scaling back the reopening of their economies, especially for businesses, such as restaurants and bars, providing services that entail personal interactions; and some high-frequency indicators that pointed to a deceleration in economic activity.

2,000

0

995