The Fed is data-driven; What drives your credit union?
In the last few FOMC meetings, the Federal Reserve has emphasized it will only act according with economic data. The same data that the Federal Reserve utilizes to make data-driven decisions are available to every credit union.
“When my colleagues and I meet, we will assess all of the available data and their implications for the economic outlook in making our policy decision.” –Janet Yellen
Behind every decision there is a driver. Every choice we make is based on past experiences and the knowledge we have about the world around us. Arguably the world’s most powerful institution, the Federal Reserve (the Fed), understands this data-driven thinking very well. It makes critical decisions that shape the global economy. Decisions this important cannot be made based on someone’s opinion. Janet Yellen, chairwoman of the Fed knows that decisions must be backed up by data from as many sources as possible. Strategically integrated data provides the Fed with a platform to make decisions that direct the United States economy.
Managing the monetary policy for the largest economy in the world is no easy undertaking. The Fed is tasked with three, often conflicting, objectives: maximizing employment, stabilizing prices, and moderating long-term interest rates. In order to do this, the Fed needs data from many different sources. Utilizing big data, the Fed is able to collect data from different sources in the United States and throughout the world. Information on consumer spending, housing, energy prices, and many other economic indicators drive the Fed to utilize big data when developing strategies for monetary policy.continue reading »