The Fed is still the dominant influence on global monetary policy, but it now finds itself operating in a more multi-polar world.
U.S. Federal Reserve Governor Jerome H. Powell @ The 2016 U.S. Monetary Policy Forum
New York, New York
February 26, 2016
Discussion Of The Paper
"Language After Liftoff: Fed Communication Away From The Zero Lower Bound"
This paper reviews Federal Open Market Committee (FOMC) communications from the time the Committee began issuing regular postmeeting statements in 1999 to the present.
The authors provide an extended and insightful discussion of the theory and practice of providing forward guidance about monetary policy. They offer one central lesson: Data-based forward guidance is mostly good, while time-based forward guidance is mostly bad.
The authors show that data-based guidance has desirable characteristics and can make monetary policy more effective . . . [image to the upper left from this paper]
The pressure is on to improve Fed communications given what the paper called the "current political environment in which the Federal Reserve is continually under attack."
Link http://www.mondovisione.com/media-and-resources/news/us-federal-reserve-governor-jerome-h-powell-at-the-2016-us-monetary-policy-f/
The authors provide an extended and insightful discussion of the theory and practice of providing forward guidance about monetary policy. They offer one central lesson: Data-based forward guidance is mostly good, while time-based forward guidance is mostly bad.
The authors show that data-based guidance has desirable characteristics and can make monetary policy more effective . . . [image to the upper left from this paper]
The pressure is on to improve Fed communications given what the paper called the "current political environment in which the Federal Reserve is continually under attack."
Link http://www.mondovisione.com/media-and-resources/news/us-federal-reserve-governor-jerome-h-powell-at-the-2016-us-monetary-policy-f/
The authors were JPMorgan's Michael Feroli, Morgan Stanley's David Greenlaw, Deutsche Bank's Peter Hooper, Frederic Mishkin of Columbia University and Amir Sufi of the University of Chicago Booth School of Business, which hosted the conference attended by Fed governors Lael Brainard, Jerome Powell and others from the central bank.
Another economic slump, another communications test for Fed
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