TextCEsInFinance/fomc-communication

index int64 0 1.98k	text stringlengths 13 1.05k	year int64 2k 2.02k	label int64 0 2	text_label stringclasses 3 values
523	We have a much more resilient, stronger banking system, and we’re not seeing some worrisome buildup in leverage or credit growth at successive levels.1 So, you know, this is something that the FOMC pays attention to,	2,015	2	neutral
524	In keeping with the practice at meetings when the Committee establishes its long-run ranges for growth of the money and debt aggregates, the members of the Committee and the Federal Reserve Bank presidents not currently serving as members had prepared individual projections of economic activity, the rate of unemployment, and inflation for the year 1996.	2,004	2	neutral
525	About two years after the onset of the financial crisis, the ECI moved up slightly in 2010 and then remained essentially flat at an annual growth rate of 2 percent over a five-year period between 2010 and 2015.	2,004	2	neutral
526	Market-based measures of inflation compensation have also picked up.	1,999	1	hawkish
527	This was a key reason why currency crises of the past few decades were so costly: Sharp depreciations of the exchange rate boosted the domestic-currency value of foreign debt and wreaked havoc with government finances and corporate balance sheets.	2,004	2	neutral
528	Incoming data suggested that, after a weak start to the year, foreign economic activity accelerated in the second quarter.	2,008	2	neutral
529	Growth in household spending moderated toward the end of last year,	2,013	2	neutral
530	That projection, along with the path to year-three inflation, should help the public differentiate short-term shocks to price stability from the longer-term price trends it should use for planning purposes.	2,007	2	neutral
531	In the staff forecast prepared for this meeting, the economy was seen as likely to expand at a moderate pace, supported by accommodative monetary policy and financial conditions.	1,996	0	dovish
532	While numerous contacts reported generally disappointing holiday sales in an environment of atypically large and widespread discounting, a surge in motor vehicle sales in December fostered by aggressive sales incentives and some pickup in retail sales late in the holiday season helped to sustain moderate overall growth in consumer spending through the year-end.	2,002	2	neutral
533	some market-based measures of inflation expectations and inflation risk suggested continuing concern among market participants about the risk of higher medium-term inflation, perhaps reflecting large fiscal deficits and the size of the Federal Reserve's balance sheet.	1,999	1	hawkish
534	On the positive side, weakness in world demand for oil was fostering a significant downtrend in energy prices, albeit with adverse effects on energy producers in this country and abroad.	1,998	0	dovish
535	Given stable prices, savers and investors have more confidence about the ultimate value of their investments.	1,998	1	hawkish
536	When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent.	2,009	1	hawkish
537	The members expected price pressures to remain relatively contained over the next several quarters in the context of what they anticipated would be only a gradual reduction of the excess capacity in labor and product markets as the recovery progressed.	2,006	2	neutral
538	Among other questions that could be addressed would be how policy actions (as opposed to inflation outcomes) influence expectations and how sensitive Federal Reserve credibility is to short-run departures from low inflation.	1,997	2	neutral
540	The jobs picture continues to be strong, with the unemployment rate near historic lows and with stronger wage gains.	2,021	1	hawkish
541	Improved prospects for a trade deal between the United States and China and accommodative monetary policy were cited as driving factors that outweighed weaker-than-expected announcements of corporate earnings for the fourth quarter of 2018 and earnings projections for 2019.	2,006	0	dovish
542	This is modeled by assuming that wage change depends on q*, while the inflation equation (based on the markup equation) depends on q.	2,003	2	neutral
543	Although productivity growth had slowed from the extraordinarily rapid pace that prevailed earlier in the expansion, data for the fourth quarter of 2004, as well as preliminary indications for the first quarter of this year, suggested that gains from efficiency remained substantial.	2,000	2	neutral
544	Those developments included a recent uptick in core measures of consumer prices, a drop in the dollar on foreign exchange markets, and still elevated energy prices--all against the backdrop of longer-term inflation expectations that were firmly anchored.	2,004	1	hawkish
545	Labor productivity growth slowed to an average pace of 1.4 percent per year over this period,	1,998	2	neutral
546	Flexible inflation averaging could bring some of the benefits of a formal average inflation targeting rule, but it would be simpler to communicate.	1,996	2	neutral
547	With respect to this particular part of the District, Jack may discuss Florida's citrus crop, the relative health of the tourism industry, and trends in Florida real estate prices.	2,005	2	neutral
548	Nonetheless, participants noted a risk that the drop-back in inflation could be slower or more limited than the Committee would find desirable since resource utilization was currently tight and the pickup in price increases had been broadly based rather than being limited to a few specific sectors that could be linked to energy costs.	2,019	1	hawkish
549	Subsequently, the expected future path of monetary policy dropped amid increasing concerns about the health of financial institutions.	1,999	0	dovish
550	Given recent developments, the medium-term outlook for inflation will receive particular scrutiny.	1,998	2	neutral
551	households’ and professional forecasters’ longer-term inflation expectations edged lower.	2,000	2	neutral
552	If independence is also defined in terms of assuring the ability and commitment of the central bank to achieve price stability, this commitment can be protected by an explicit price stability mandate from the government.	2,001	1	hawkish
553	At the end of the day, we all benefit from plentiful jobs and stable prices, whether we are savers or borrowers--and many of us, of course, are both.	2,022	2	neutral
554	And the way I would explain it is, is that inflation that’s too low will mean that interest rates are lower.	2,022	0	dovish
555	A few participants pointed to continued strong growth in multifamily construction, although the limited pipeline of new projects in one District suggested that activity could slow in 2015.	2,020	2	neutral
556	We must keep in mind that, difficult as the problem seems, consistently measured prices do exist in principle.	2,021	2	neutral
557	The staff's forecast for inflation was basically unchanged from the projection prepared for the previous FOMC meeting.	2,021	2	neutral
558	The second point that I made was that when short-term interest rates hit zero, the tools of a central bank are no longer—are not exhausted, there are still other things that the central bank can do to create additional accommodation.	2,012	0	dovish
559	Faster productivity growth was among the factors that boosted equity valuations	2,006	0	dovish
560	In general, financial markets were viewed as well positioned to support more vigorous expansion in economic activity.	2,017	0	dovish
561	Inflation has declined further below our longer-run objective, largely reflecting the lower energy prices I just mentioned.	2,012	0	dovish
562	Still, core consumer price indices remained relatively damped and had risen only a little over the last year, especially when measured by the PCE chain-price index, and that suggested underlying price pressures remained largely contained.	2,001	2	neutral
563	Palmer was a professor at Wharton, a fellow of the American Statistical Association, a worldwide expert on manpower and labor mobility, and a consultant with the Office of Statistical Standards.5 She argued that "a single figure of unemployment, regardless of how it is defined or derived, is inadequate as a basis for selection among [policy] programs.	2,007	2	neutral
564	not enough to lower the unemployment rate, and labor productivity seemed to be trending sharply upward.	2,005	0	dovish
565	In addition, the Survey of Terms of Business Lending conducted in the first week of November showed that interest rates on C&I loans were generally little changed while spreads remained extremely wide.	2,017	1	hawkish
566	Finally, while my assessment of maximum employment incorporates a wide range of indicators to assess the state of the labor marketâ€”including indicators of labor compensation, productivity, and price-cost markupsâ€”the employment data I look at, such as the Kansas City Fed's Labor Market Conditions Indicators, are historically highly correlated with the unemployment rate.8 My expectation today is that the labor market by the end of 2022 will have reached my assessment of maximum employment if the unemployment rate has declined by then to the SEP median of modal projections of 3.8 percent.	2,006	1	hawkish
567	While the underlying demand for residential housing continued to be robust and government outlays evidently were rising, the expansion of consumer spending seemed to have slowed, and outlays for capital spending were still very sluggish in an environment of business uncertainty and pessimism.	2,006	0	dovish
568	Domestic respondents to the April SLOOS generally reported tightening their lending standards and experiencing weaker loan demand across all major CRE loan categories during the first quarter.	2,016	0	dovish
569	Inflation is a significant challenge for everyone, but it hits lower- and moderate-income people the hardest, since they spend a larger share of their incomes on necessities and often have less savings to fall back on.	2,005	1	hawkish
570	Referring to monetary policy developments in the 1980s, Greenspan writes: In recognition of the lag in monetary policy's impact on economic activity, a preemptive response to the potential for building inflationary pressures was made an even more important feature of policy.	2,004	2	neutral
571	Members noted that most broad measures of inflation moved together over extended periods of time, but they did not always do so over short intervals.	1,997	2	neutral
572	The staff assessed that households were in a better position than in the mid-2000s to weather a downturn in house prices, noting that mortgage debt growth has significantly lagged growth in house prices, leaving households with substantial equity cushions.	1,998	2	neutral
573	On the other hand, including a reference risked the possibility of suggesting greater concern on the part of the Committee than was actually the case, perhaps leading to the misimpression that monetary policy was likely to respond to increases in volatility.	1,998	2	neutral
574	My goal is not to draw conclusions on recent movements in risk premiums but rather to give you a sense of how estimates of risk premiums may influence our policy decisionmaking, to note some of the difficulties that we face in interpreting their movements, and, I hope, to stimulate further research in this already fertile field.1 At the Federal Reserve, we pay a lot of attention to financial market prices in the formulation of monetary policy.	2,021	2	neutral
575	Market sentiment toward the syndicated leveraged loan market also improved, with the average bid price increasing noticeably and bid-asked spreads narrowing a bit further.	2,002	2	neutral
576	This increase was slower than a year earlier, as core PCE price inflation (which excludes changes in consumer food and energy prices) moved down to 1.	2,004	0	dovish
577	The fundamental price of an asset typically is defined in terms of the discounted present value of the income stream or equivalent services that the asset is expected to provide over time.	2,004	2	neutral
578	Moreover, current data suggested little or no growth in overall expenditures on nonresidential structures.	2,003	2	neutral
579	In particular, I will focus on liquidity regulation and supervision as well as interactions with monetary policy tools.	2,021	2	neutral
580	The System Open Market Account Manager and the Secretary will keep the Committee informed of ongoing developments regarding the System's balance sheet that could affect the attainment over time of the Committee's objectives of maximum employment and price stability. "	2,002	2	neutral
581	We found that a surprise increase of 25 basis points in the funds rate target typically results in a decline in broad equity indexes of about 1 percent, whereas a change in the funds rate that is expected by the market has essentially no effect on stock prices.17 Our work is just one example of a number of event-study analyses that may well shed light on the effects of monetary policy and the channels of monetary policy transmission.	2,003	2	neutral
582	That’s probably related to gas prices and also just stock prices to some extent for other people.	2,016	2	neutral
583	In their discussion of monetary policy for the intermeeting period, Committee members agreed that the Federal Reserve's large-scale securities purchases were providing financial stimulus that would contribute to the gradual resumption of sustainable economic growth in a context of price stability.	2,021	0	dovish
585	For example, given the starting point for the outlook, the forecasts will trace out a path for the economy to preserve or reestablish maximum employment and price stability that will reflect FOMC participants' views of the relative variation in output and inflation that is possible in the short run.	2,004	2	neutral
586	Participants discussed several risks that, if realized, could necessitate a steeper path of increases in the target range; these risks included the possibility that inflation pressures could build unduly if output expanded well beyond its maximum sustainable level, perhaps owing to fiscal stimulus or accommodative financial market conditions.	1,998	1	hawkish
587	However, it was noted that slower growth in productivity might have become the norm.	2,006	2	neutral
588	A commonly used analogy takes the U.S. economy to be an automobile, the FOMC to be the driver, and monetary policy actions to be taps on the accelerator or brake.	1,997	2	neutral
589	In that regard, the changes in the macroeconomic environment that underlie our monetary policy review may have some implications for financial stability.	2,022	2	neutral
590	All members agreed that the risks to achieving the anticipated reduction in inflation remained of greatest concern.	1,997	1	hawkish
591	However, reports from a couple of Districts indicated that the agricultural sector was still weak, with low commodity prices continuing to put financial pressure on farm-related businesses.	2,000	0	dovish
592	Many members of the Committee, participants, have said that they think policy should be based on the actual evolution of economic activity and inflation, which tends to be variable over time, and that’s why I say I anticipate it will be data dependent.	2,012	2	neutral
594	You know, we’re, we’re—inflation measures are always going to be a bit volatile.	2,014	2	neutral
595	In their discussion of developments in asset markets, the participants' comments focused on two related issues: the low level of long-term interest rates and the continued run-up in home prices.	2,021	1	hawkish
596	Monetary policy decisions are judgment calls, informed by forecasts and discussions about how the economy is likely to evolve, alternative possibilities, and potential responses to policy actions.	2,021	2	neutral
597	Staff Economic Outlook In the economic forecast prepared by the staff for the June FOMC meeting, real GDP growth in the second half of this year was expected to step up from its pace in the first half.	2,012	1	hawkish
598	Well, you know, if the economy were disappointing, we—you know, our actions wouldn’t purely be based on inflation, we would also take employment into account.	2,022	0	dovish
599	Most projected somewhat slower growth through next year, and a smaller reduction in unemployment, than they had projected in April.	2,005	0	dovish
600	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	dovish
601	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	dovish
602	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	hawkish
603	Stimulus checks put money in people's pockets, and when they spend it, there will be upward pressure on prices.	2,006	1	hawkish
604	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	neutral
605	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	hawkish
606	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	neutral
607	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	neutral
608	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	neutral
609	also by views about how fiscal policy might adjust to monetary policy.	2,008	2	neutral
610	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	hawkish
611	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	neutral
612	One of Dick Porter's many contributions was to develop a monetary approach to forecasting inflation at medium-term horizons.	2,001	2	neutral
613	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	neutral
614	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	hawkish
615	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	dovish
616	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	neutral
617	with a healthy job market, rising incomes, and upbeat consumer confidence, the fundamentals supporting household spending are solid.	2,013	2	neutral
618	the prices of some key commodities had increased recently.	2,016	1	hawkish
619	Going forward, the question is not only whether inflation will fall in the coming months,	1,998	2	neutral
620	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	neutral
621	Consumer food prices were little changed in August.	2,006	2	neutral
622	The U. S. international trade deficit declined somewhat in May after reaching a record high in April.	2,010	2	neutral
623	Participants commented on the continued improvement in labor market conditions in recent months driven by strong demand for workers.	2,003	2	neutral
624	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	neutral
626	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	dovish

523

We have a much more resilient, stronger banking system, and we’re not seeing some worrisome buildup in leverage or credit growth at successive levels.1 So, you know, this is something that the FOMC pays attention to,

2,015

2

neutral

524

In keeping with the practice at meetings when the Committee establishes its long-run ranges for growth of the money and debt aggregates, the members of the Committee and the Federal Reserve Bank presidents not currently serving as members had prepared individual projections of economic activity, the rate of unemployment, and inflation for the year 1996.

2,004

2

neutral

525

About two years after the onset of the financial crisis, the ECI moved up slightly in 2010 and then remained essentially flat at an annual growth rate of 2 percent over a five-year period between 2010 and 2015.

2,004

2

neutral

526

Market-based measures of inflation compensation have also picked up.

1,999

1

hawkish

527

This was a key reason why currency crises of the past few decades were so costly: Sharp depreciations of the exchange rate boosted the domestic-currency value of foreign debt and wreaked havoc with government finances and corporate balance sheets.

2,004

2

neutral

528

Incoming data suggested that, after a weak start to the year, foreign economic activity accelerated in the second quarter.

2,008

2

neutral

529

Growth in household spending moderated toward the end of last year,

2,013

2

neutral

530

That projection, along with the path to year-three inflation, should help the public differentiate short-term shocks to price stability from the longer-term price trends it should use for planning purposes.

2,007

2

neutral

531

In the staff forecast prepared for this meeting, the economy was seen as likely to expand at a moderate pace, supported by accommodative monetary policy and financial conditions.

1,996

0

dovish

532

While numerous contacts reported generally disappointing holiday sales in an environment of atypically large and widespread discounting, a surge in motor vehicle sales in December fostered by aggressive sales incentives and some pickup in retail sales late in the holiday season helped to sustain moderate overall growth in consumer spending through the year-end.

2,002

2

neutral

533

some market-based measures of inflation expectations and inflation risk suggested continuing concern among market participants about the risk of higher medium-term inflation, perhaps reflecting large fiscal deficits and the size of the Federal Reserve's balance sheet.

1,999

1

hawkish

534

On the positive side, weakness in world demand for oil was fostering a significant downtrend in energy prices, albeit with adverse effects on energy producers in this country and abroad.

1,998

0

dovish

535

Given stable prices, savers and investors have more confidence about the ultimate value of their investments.

1,998

1

hawkish

536

When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent.

2,009

1

hawkish

537

The members expected price pressures to remain relatively contained over the next several quarters in the context of what they anticipated would be only a gradual reduction of the excess capacity in labor and product markets as the recovery progressed.

2,006

2

neutral

538

Among other questions that could be addressed would be how policy actions (as opposed to inflation outcomes) influence expectations and how sensitive Federal Reserve credibility is to short-run departures from low inflation.

1,997

2

neutral

540

The jobs picture continues to be strong, with the unemployment rate near historic lows and with stronger wage gains.

2,021

1

hawkish

541

Improved prospects for a trade deal between the United States and China and accommodative monetary policy were cited as driving factors that outweighed weaker-than-expected announcements of corporate earnings for the fourth quarter of 2018 and earnings projections for 2019.

2,006

0

dovish

542

This is modeled by assuming that wage change depends on q*, while the inflation equation (based on the markup equation) depends on q.

2,003

2

neutral

543

Although productivity growth had slowed from the extraordinarily rapid pace that prevailed earlier in the expansion, data for the fourth quarter of 2004, as well as preliminary indications for the first quarter of this year, suggested that gains from efficiency remained substantial.

2,000

2

neutral

544

Those developments included a recent uptick in core measures of consumer prices, a drop in the dollar on foreign exchange markets, and still elevated energy prices--all against the backdrop of longer-term inflation expectations that were firmly anchored.

2,004

1

hawkish

545

Labor productivity growth slowed to an average pace of 1.4 percent per year over this period,

1,998

2

neutral

546

Flexible inflation averaging could bring some of the benefits of a formal average inflation targeting rule, but it would be simpler to communicate.

1,996

2

neutral

547

With respect to this particular part of the District, Jack may discuss Florida's citrus crop, the relative health of the tourism industry, and trends in Florida real estate prices.

2,005

2

neutral

548

Nonetheless, participants noted a risk that the drop-back in inflation could be slower or more limited than the Committee would find desirable since resource utilization was currently tight and the pickup in price increases had been broadly based rather than being limited to a few specific sectors that could be linked to energy costs.

2,019

1

hawkish

549

Subsequently, the expected future path of monetary policy dropped amid increasing concerns about the health of financial institutions.

1,999

0

dovish

550

Given recent developments, the medium-term outlook for inflation will receive particular scrutiny.

1,998

2

neutral

551

households’ and professional forecasters’ longer-term inflation expectations edged lower.

2,000

2

neutral

552

If independence is also defined in terms of assuring the ability and commitment of the central bank to achieve price stability, this commitment can be protected by an explicit price stability mandate from the government.

2,001

1

hawkish

553

At the end of the day, we all benefit from plentiful jobs and stable prices, whether we are savers or borrowers--and many of us, of course, are both.

2,022

2

neutral

554

And the way I would explain it is, is that inflation that’s too low will mean that interest rates are lower.

2,022

0

dovish

555

A few participants pointed to continued strong growth in multifamily construction, although the limited pipeline of new projects in one District suggested that activity could slow in 2015.

2,020

2

neutral

556

We must keep in mind that, difficult as the problem seems, consistently measured prices do exist in principle.

2,021

2

neutral

557

The staff's forecast for inflation was basically unchanged from the projection prepared for the previous FOMC meeting.

2,021

2

neutral

558

The second point that I made was that when short-term interest rates hit zero, the tools of a central bank are no longer—are not exhausted, there are still other things that the central bank can do to create additional accommodation.

2,012

0

dovish

559

Faster productivity growth was among the factors that boosted equity valuations

2,006

0

dovish

560

In general, financial markets were viewed as well positioned to support more vigorous expansion in economic activity.

2,017

0

dovish

561

Inflation has declined further below our longer-run objective, largely reflecting the lower energy prices I just mentioned.

2,012

0

dovish

562

Still, core consumer price indices remained relatively damped and had risen only a little over the last year, especially when measured by the PCE chain-price index, and that suggested underlying price pressures remained largely contained.

2,001

2

neutral

563

Palmer was a professor at Wharton, a fellow of the American Statistical Association, a worldwide expert on manpower and labor mobility, and a consultant with the Office of Statistical Standards.5 She argued that "a single figure of unemployment, regardless of how it is defined or derived, is inadequate as a basis for selection among [policy] programs.

2,007

2

neutral

564

not enough to lower the unemployment rate, and labor productivity seemed to be trending sharply upward.

2,005

0

dovish

565

In addition, the Survey of Terms of Business Lending conducted in the first week of November showed that interest rates on C&I loans were generally little changed while spreads remained extremely wide.

2,017

1

hawkish

566

Finally, while my assessment of maximum employment incorporates a wide range of indicators to assess the state of the labor marketâ€”including indicators of labor compensation, productivity, and price-cost markupsâ€”the employment data I look at, such as the Kansas City Fed's Labor Market Conditions Indicators, are historically highly correlated with the unemployment rate.8 My expectation today is that the labor market by the end of 2022 will have reached my assessment of maximum employment if the unemployment rate has declined by then to the SEP median of modal projections of 3.8 percent.

2,006

1

hawkish

567

While the underlying demand for residential housing continued to be robust and government outlays evidently were rising, the expansion of consumer spending seemed to have slowed, and outlays for capital spending were still very sluggish in an environment of business uncertainty and pessimism.

2,006

0

dovish

568

Domestic respondents to the April SLOOS generally reported tightening their lending standards and experiencing weaker loan demand across all major CRE loan categories during the first quarter.

2,016

0

dovish

569

Inflation is a significant challenge for everyone, but it hits lower- and moderate-income people the hardest, since they spend a larger share of their incomes on necessities and often have less savings to fall back on.

2,005

1

hawkish

570

Referring to monetary policy developments in the 1980s, Greenspan writes: In recognition of the lag in monetary policy's impact on economic activity, a preemptive response to the potential for building inflationary pressures was made an even more important feature of policy.

2,004

2

neutral

571

Members noted that most broad measures of inflation moved together over extended periods of time, but they did not always do so over short intervals.

1,997

2

neutral

572

The staff assessed that households were in a better position than in the mid-2000s to weather a downturn in house prices, noting that mortgage debt growth has significantly lagged growth in house prices, leaving households with substantial equity cushions.

1,998

2

neutral

573

On the other hand, including a reference risked the possibility of suggesting greater concern on the part of the Committee than was actually the case, perhaps leading to the misimpression that monetary policy was likely to respond to increases in volatility.

1,998

2

neutral

574

My goal is not to draw conclusions on recent movements in risk premiums but rather to give you a sense of how estimates of risk premiums may influence our policy decisionmaking, to note some of the difficulties that we face in interpreting their movements, and, I hope, to stimulate further research in this already fertile field.1 At the Federal Reserve, we pay a lot of attention to financial market prices in the formulation of monetary policy.

2,021

2

neutral

575

Market sentiment toward the syndicated leveraged loan market also improved, with the average bid price increasing noticeably and bid-asked spreads narrowing a bit further.

2,002

2

neutral

576

This increase was slower than a year earlier, as core PCE price inflation (which excludes changes in consumer food and energy prices) moved down to 1.

2,004

0

dovish

577

The fundamental price of an asset typically is defined in terms of the discounted present value of the income stream or equivalent services that the asset is expected to provide over time.

2,004

2

neutral

578

Moreover, current data suggested little or no growth in overall expenditures on nonresidential structures.

2,003

2

neutral

579

In particular, I will focus on liquidity regulation and supervision as well as interactions with monetary policy tools.

2,021

2

neutral

580

The System Open Market Account Manager and the Secretary will keep the Committee informed of ongoing developments regarding the System's balance sheet that could affect the attainment over time of the Committee's objectives of maximum employment and price stability. "

2,002

2

neutral

581

We found that a surprise increase of 25 basis points in the funds rate target typically results in a decline in broad equity indexes of about 1 percent, whereas a change in the funds rate that is expected by the market has essentially no effect on stock prices.17 Our work is just one example of a number of event-study analyses that may well shed light on the effects of monetary policy and the channels of monetary policy transmission.

2,003

2

neutral

582

That’s probably related to gas prices and also just stock prices to some extent for other people.

2,016

2

neutral

583

In their discussion of monetary policy for the intermeeting period, Committee members agreed that the Federal Reserve's large-scale securities purchases were providing financial stimulus that would contribute to the gradual resumption of sustainable economic growth in a context of price stability.

2,021

0

dovish

585

For example, given the starting point for the outlook, the forecasts will trace out a path for the economy to preserve or reestablish maximum employment and price stability that will reflect FOMC participants' views of the relative variation in output and inflation that is possible in the short run.

2,004

2

neutral

586

Participants discussed several risks that, if realized, could necessitate a steeper path of increases in the target range; these risks included the possibility that inflation pressures could build unduly if output expanded well beyond its maximum sustainable level, perhaps owing to fiscal stimulus or accommodative financial market conditions.

1,998

1

hawkish

587

However, it was noted that slower growth in productivity might have become the norm.

2,006

2

neutral

588

A commonly used analogy takes the U.S. economy to be an automobile, the FOMC to be the driver, and monetary policy actions to be taps on the accelerator or brake.

1,997

2

neutral

589

In that regard, the changes in the macroeconomic environment that underlie our monetary policy review may have some implications for financial stability.

2,022

2

neutral

590

All members agreed that the risks to achieving the anticipated reduction in inflation remained of greatest concern.

1,997

1

hawkish

591

However, reports from a couple of Districts indicated that the agricultural sector was still weak, with low commodity prices continuing to put financial pressure on farm-related businesses.

2,000

0

dovish

592

Many members of the Committee, participants, have said that they think policy should be based on the actual evolution of economic activity and inflation, which tends to be variable over time, and that’s why I say I anticipate it will be data dependent.

2,012

2

neutral

594

You know, we’re, we’re—inflation measures are always going to be a bit volatile.

2,014

2

neutral

595

In their discussion of developments in asset markets, the participants' comments focused on two related issues: the low level of long-term interest rates and the continued run-up in home prices.

2,021

1

hawkish

596

Monetary policy decisions are judgment calls, informed by forecasts and discussions about how the economy is likely to evolve, alternative possibilities, and potential responses to policy actions.

2,021

2

neutral

597

Staff Economic Outlook In the economic forecast prepared by the staff for the June FOMC meeting, real GDP growth in the second half of this year was expected to step up from its pace in the first half.

2,012

1

hawkish

598

Well, you know, if the economy were disappointing, we—you know, our actions wouldn’t purely be based on inflation, we would also take employment into account.

2,022

0

dovish

599

Most projected somewhat slower growth through next year, and a smaller reduction in unemployment, than they had projected in April.

2,005

0

dovish

600

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

dovish

601

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

dovish

602

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

hawkish

603

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

2,006

1

hawkish

604

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

neutral

605

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

hawkish

606

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

neutral

607

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

neutral

608

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

neutral

609

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

2,008

2

neutral

610

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

hawkish

611

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

neutral

612

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

2,001

2

neutral

613

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

neutral

614

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

hawkish

615

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

dovish

616

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

neutral

617

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

2,013

2

neutral

618

the prices of some key commodities had increased recently.

2,016

1

hawkish

619

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

1,998

2

neutral

620

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

neutral

621

Consumer food prices were little changed in August.

2,006

2

neutral

622

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

2,010

2

neutral

623

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

2,003

2

neutral

624

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

neutral

626

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

dovish