FOMC statement of July 31, 2013
This statement of the Federal Open Market Committee, compared sentence by sentence with the scheduled statement before it: what changed in the text, and how the Committee voted.
In short
The Federal Open Market Committee released this statement on July 31, 2013. Compared with the previous scheduled statement of June 19, 2013: 5 sentences changed, 1 was added, 1 was removed, and 14 stayed the same. In words: 59 added, 58 removed. The vote on this statement: 1 member voted against: Esther L. George. On the June 19, 2013 statement: 2 members voted against: James Bullard, Esther L. George.
FOMC statement · July 31, 2013
Changed sentences against the previous scheduled statement (June 19, 2013)
14 unchanged · 5 changed · 1 added · 1 removed · words +59 / −58
- June 19, 2013
- 2 members voted against: James Bullard, Esther L. George.
- July 31, 2013
- 1 member voted against: Esther L. George.
Information received since the Federal Open Market Committee met in May June suggests that economic activity has been expanding expanded at a moderate modest pace during the first half of the year.
Household spending and business fixed investment advanced, and the housing sector has strengthened further been strengthening, but mortgage rates have risen somewhat and fiscal policy is restraining economic growth.
The Committee expects that, with appropriate policy accommodation, economic growth will proceed at a moderate pick up from its recent pace and the unemployment rate will gradually decline toward levels the Committee judges consistent with its dual mandate.
The Committee also anticipates that inflation over the medium term likely will run at or below its 2 percent objective.
The Committee recognizes that inflation persistently below its 2 percent objective could pose risks to economic performance, but it anticipates that inflation will move back toward its objective over the medium term.
To support continued progress toward maximum employment and price stability, the Committee expects today reaffirmed its view that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the asset purchase program ends and the economic recovery strengthens.
Voting against the action was James Bullard, who believed that the Committee should signal more strongly its willingness to defend its inflation goal in light of recent low inflation readings, and Esther L. George, who was concerned that the continued high level of monetary accommodation increased the risks of future economic and financial imbalances and, over time, could cause an increase in long-term inflation expectations.
Show the 14 unchanged sentences
Labor market conditions have shown further improvement in recent months, on balance, but the unemployment rate remains elevated.
Partly reflecting transitory influences, inflation has been running below the Committee's longer-run objective, but longer-term inflation expectations have remained stable.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability.
The Committee sees the downside risks to the outlook for the economy and the labor market as having diminished since the fall.
To support a stronger economic recovery and to help ensure that inflation, over time, is at the rate most consistent with its dual mandate, the Committee decided to continue purchasing additional agency mortgage-backed securities at a pace of $40 billion per month and longer-term Treasury securities at a pace of $45 billion per month.
The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction.
Taken together, these actions should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative.
The Committee will closely monitor incoming information on economic and financial developments in coming months.
The Committee will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability.
The Committee is prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation as the outlook for the labor market or inflation changes.
In determining the size, pace, and composition of its asset purchases, the Committee will continue to take appropriate account of the likely efficacy and costs of such purchases as well as the extent of progress toward its economic objectives.
In particular, the Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that this exceptionally low range for the federal funds rate will be appropriate at least as long as the unemployment rate remains above 6-1/2 percent, inflation between one and two years ahead is projected to be no more than a half percentage point above the Committee's 2 percent longer-run goal, and longer-term inflation expectations continue to be well anchored.
In determining how long to maintain a highly accommodative stance of monetary policy, the Committee will also consider other information, including additional measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments.
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.
Source: Board of Governors of the Federal Reserve System — the statement on federalreserve.gov · June 19, 2013
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