FOMC statement of January 28, 2015
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 January 28, 2015. Compared with the previous scheduled statement of December 17, 2014: 9 sentences changed, 1 was added, 2 were removed, and 12 stayed the same. In words: 51 added, 225 removed. The vote on this statement: Unanimous. On the December 17, 2014 statement: 3 members voted against: Richard W. Fisher, Narayana Kocherlakota, Charles I. Plosser.
FOMC statement · January 28, 2015
Changed sentences against the previous scheduled statement (December 17, 2014)
12 unchanged · 9 changed · 1 added · 2 removed · words +51 / −225
- December 17, 2014
- 3 members voted against: Richard W. Fisher, Narayana Kocherlakota, Charles I. Plosser.
- January 28, 2015
- Unanimous.
Information received since the Federal Open Market Committee met in October December suggests that economic activity is has been expanding at a moderate solid pace.
Labor market conditions have improved further, with solid strong job gains and a lower unemployment rate.
Household spending is rising moderately; recent declines in energy prices have boosted household purchasing power.
Household spending is rising moderately and Business fixed investment is advancing, while the recovery in the housing sector remains slow.
Inflation has continued to run declined further below the Committee's longer-run objective, partly largely reflecting declines in energy prices.
Market-based measures of inflation compensation have declined somewhat further substantially in recent months; survey-based measures of longer-term inflation expectations have remained stable.
The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators moving continuing to move toward levels the Committee judges consistent with its dual mandate.
The Committee sees continues to see the risks to the outlook for economic activity and the labor market as nearly balanced.
Inflation is anticipated to decline further in the near term, but the Committee expects inflation to rise gradually toward 2 percent over the medium term as the labor market improves further and the transitory effects of lower energy prices and other factors dissipate.
This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.
The Committee sees this guidance as consistent with its previous statement that it likely will be appropriate to maintain the 0 to 1/4 percent target range for the federal funds rate for a considerable time following the end of its asset purchase program in October, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored.
Voting against the action were Richard W. Fisher, who believed that, while the Committee should be patient in beginning to normalize monetary policy, improvement in the U.S. economic performance since October has moved forward, further than the majority of the Committee envisions, the date when it will likely be appropriate to increase the federal funds rate; Narayana Kocherlakota, who believed that the Committee's decision, in the context of ongoing low inflation and falling market-based measures of longer-term inflation expectations, created undue downside risk to the credibility of the 2 percent inflation target; and Charles I. Plosser, who believed that the statement should not stress the importance of the passage of time as a key element of its forward guidance and, given the improvement in economic conditions, should not emphasize the consistency of the current forward guidance with previous statements.
Show the 12 unchanged sentences
On balance, a range of labor market indicators suggests that underutilization of labor resources continues to diminish.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability.
The Committee continues to monitor inflation developments closely.
To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that the current 0 to 1/4 percent target range for the federal funds rate remains appropriate.
In determining how long to maintain this target range, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation.
Based on its current assessment, the Committee judges that it can be patient in beginning to normalize the stance of monetary policy.
However, if incoming information indicates faster progress toward the Committee's employment and inflation objectives than the Committee now expects, then increases in the target range for the federal funds rate are likely to occur sooner than currently anticipated.
Conversely, if progress proves slower than expected, then increases in the target range are likely to occur later than currently anticipated.
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.
This policy, by keeping the Committee's holdings of longer-term securities at sizable levels, should help maintain accommodative financial conditions.
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.
The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.
Source: Board of Governors of the Federal Reserve System — the statement on federalreserve.gov · December 17, 2014
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