Federal Reserve Vice Chair Richard Clarida Monday provided an update on the Federal Open Market Committee’s new strategy framework – adopted in August – to better reflect economic changes and monetary policy approaches.
Throughout the coronavirus pandemic, the Fed has made clear its intention to use its tools to their fullest potential until the crisis has passed and economic recovery is well underway. During its August meeting, the FOMC updated its Statement on Longer-Run Goals and Monetary Policy Strategy, which NAFCU Chief Economist and Vice President of Research Curt Long said “looks to avoid the mistakes of the past.”
Under the updated statement, significant changes were made to:
- maximum employment, which the FOMC emphasized that maximum employment is a broad-based and inclusive goal and reports that its policy decision will be informed by its “assessments of the shortfalls of employment from its maximum level;”
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