FOMC statement of March 23, 2020
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 unscheduled statement on March 23, 2020 (March 23 (notation vote) - 2020). Compared with the previous scheduled statement of January 29, 2020: 0 sentences changed, 19 were added, 11 were removed, and 0 stayed the same. In words: 592 added, 273 removed. The vote on this statement: Unanimous. On the January 29, 2020 statement: Unanimous.
An unscheduled statement (Fed calendar: “March 23 (notation vote) - 2020”). It is compared with the previous scheduled statement, so many sentences can look changed because the format differs. The comparison with the statement right before it is further down.
FOMC statement · March 23, 2020
Changed sentences against the previous scheduled statement (January 29, 2020)
Unscheduled statements this comparison skips: March 3, 2020, March 15, 2020
0 unchanged · 0 changed · 19 added · 11 removed · words +592 / −273
- January 29, 2020
- Unanimous.
- March 23, 2020
- Unanimous.
Information received since the Federal Open Market Committee met in December indicates that the labor market remains strong and that economic activity has been rising at a moderate rate.
Job gains have been solid, on average, in recent months, and the unemployment rate has remained low.
Although household spending has been rising at a moderate pace, business fixed investment and exports remain weak.
On a 12‐month basis, overall inflation and inflation for items other than food and energy are running below 2 percent.
Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability.
The Committee decided to maintain the target range for the federal funds rate at 1‐1/2 to 1-3/4 percent.
The Committee judges that the current stance of monetary policy is appropriate to support sustained expansion of economic activity, strong labor market conditions, and inflation returning to the Committee's symmetric 2 percent objective.
The Committee will continue to monitor the implications of incoming information for the economic outlook, including global developments and muted inflation pressures, as it assesses the appropriate path of the target range for the federal funds rate.
In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective.
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 Federal Reserve is committed to use its full range of tools to support the U.S. economy in this challenging time and thereby promote its maximum employment and price stability goals.
The Federal Open Market Committee is taking further actions to support the flow of credit to households and businesses by addressing strains in the markets for Treasury securities and agency mortgage-backed securities.
The Federal Reserve will continue to purchase Treasury securities and agency mortgage-backed securities in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions.
The Committee will include purchases of agency commercial mortgage-backed securities in its agency mortgage-backed security purchases.
In addition, the Open Market Desk will continue to offer large-scale overnight and term repurchase agreement operations.
The Committee will continue to closely monitor market conditions, and will assess the appropriate pace of its securities purchases at future meetings.
Voting (by notation) for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Michelle W. Bowman; Lael Brainard; Richard H. Clarida; Patrick Harker; Robert S. Kaplan; Neel Kashkari; Loretta J. Mester; and Randal K. Quarles.
In a related set of actions, the Federal Reserve announced additional measures to support the flow of credit to households and businesses.
More information can be found on the Federal Reserve Board's website .
In connection with these plans, the Committee voted unanimously to authorize and direct the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account in accordance with the following domestic policy directive: "Effective March 23, 2020, the Federal Open Market Committee directs the Desk to undertake open market operations as necessary to maintain the federal funds rate in a target range of 0 to 1/4 percent.
The Committee directs the Desk to increase the System Open Market Account holdings of Treasury securities and agency mortgage-backed securities (MBS) in the amounts needed to support the smooth functioning of markets for Treasury securities and agency MBS.
The Committee also directs the Desk to include purchases of agency commercial mortgage-backed securities in its agency mortgage-backed security purchases.
The Committee also directs the Desk to continue conducting term and overnight repurchase agreement operations to ensure that the supply of reserves remains ample and to support the smooth functioning of short-term U.S. dollar funding markets.
In addition, the Committee directs the Desk to conduct overnight reverse repurchase operations (and reverse repurchase operations with maturities of more than one day when necessary to accommodate weekend, holiday, or similar trading conventions) at an offering rate of 0.00 percent, in amounts limited only by the value of Treasury securities held outright in the System Open Market Account that are available for such operations and by a per-counterparty limit of $30 billion per day.
The Committee directs the Desk to continue rolling over at auction all principal payments from the Federal Reserve's holdings of Treasury securities and to reinvest all principal payments from the Federal Reserve's holdings of agency debt and agency mortgage-backed securities received during each calendar month in agency mortgage-backed securities.
Small deviations from these amounts for operational reasons are acceptable.
The Committee also directs the Desk to engage in dollar roll and coupon swap transactions as necessary to facilitate settlement of the Federal Reserve's agency mortgage-backed securities transactions."
More information regarding open market operations and reinvestments may be found on the Federal Reserve Bank of New York's website .
Federal Reserve announces extensive new measures to support the economy Statement Regarding Treasury Securities and Agency Mortgage-Backed Securities Operations
Source: Board of Governors of the Federal Reserve System — the statement on federalreserve.gov · January 29, 2020
Compared with the statement right before it (March 15, 2020)
FOMC statement · March 23, 2020
Changed sentences against the previous statement (March 15, 2020)
1 unchanged · 4 changed · 14 added · 20 removed · words +524 / −558
- March 15, 2020
- 1 member voted against: Loretta J. Mester.
- March 23, 2020
- Unanimous.
The coronavirus outbreak has harmed communities and disrupted economic activity in many countries, including the United States.
Global financial conditions have also been significantly affected.
Available economic data show that the U.S. economy came into this challenging period on a strong footing.
Information received since the Federal Open Market Committee met in January indicates that the labor market remained strong through February and economic activity rose at a moderate rate.
Job gains have been solid, on average, in recent months, and the unemployment rate has remained low.
Although household spending rose at a moderate pace, business fixed investment and exports remained weak.
More recently, the energy sector has come under stress.
On a 12‐month basis, overall inflation and inflation for items other than food and energy are running below 2 percent.
Market-based measures of inflation compensation have declined; survey-based measures of longer-term inflation expectations are little changed.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability.
The effects of the coronavirus will weigh on economic activity in the near term and pose risks to the economic outlook.
In light of these developments, the Committee decided to lower the target range for the federal funds rate to 0 to 1/4 percent.
The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.
This action will help support economic activity, strong labor market conditions, and inflation returning to the Committee's symmetric 2 percent objective.
The Committee will continue to monitor the implications of incoming information for the economic outlook, including information related to public health, as well as global developments and muted inflation pressures, and will use its tools and act as appropriate to support the economy.
In determining the timing and size of future adjustments to the stance of monetary policy, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective.
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 Federal Reserve is prepared committed to use its full range of tools to support the flow of credit to households and businesses U.S. economy in this challenging time and thereby promote its maximum employment and price stability goals.
To support the smooth functioning of markets for Treasury securities and agency mortgage-backed securities that are central to the flow of credit to households and businesses, over coming months the Committee will increase its holdings of Treasury securities by at least $500 billion and its holdings of agency mortgage-backed securities by at least $200 billion.
The Federal Open Market Committee is taking further actions to support the flow of credit to households and businesses by addressing strains in the markets for Treasury securities and agency mortgage-backed securities.
The Federal Reserve will continue to purchase Treasury securities and agency mortgage-backed securities in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions.
The Committee will also reinvest all principal payments from the Federal Reserve's holdings include purchases of agency debt and agency commercial mortgage-backed securities in its agency mortgage-backed securities security purchases.
In addition, the Open Market Desk has recently expanded its will continue to offer large-scale overnight and term repurchase agreement operations.
The Committee will continue to closely monitor market conditions, and is prepared to adjust will assess the appropriate pace of its plans as appropriate securities purchases at future meetings.
Voting against this action was Loretta J. Mester, who was fully supportive of all of the actions taken to promote the smooth functioning of markets and the flow of credit to households and businesses but preferred to reduce the target range for the federal funds rate to 1/2 to 3/4 percent at this meeting.
In a related set of actions to support the credit needs of households and businesses, the Federal Reserve announced measures related to the discount window, intraday credit, bank capital and liquidity buffers, reserve requirements, and-in coordination with other central banks-the U.S. dollar liquidity swap line arrangements.
Voting (by notation) for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Michelle W. Bowman; Lael Brainard; Richard H. Clarida; Patrick Harker; Robert S. Kaplan; Neel Kashkari; Loretta J. Mester; and Randal K. Quarles.
In a related set of actions, the Federal Reserve announced additional measures to support the flow of credit to households and businesses.
In connection with these plans, the Committee voted unanimously to authorize and direct the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account in accordance with the following domestic policy directive: "Effective March 23, 2020, the Federal Open Market Committee directs the Desk to undertake open market operations as necessary to maintain the federal funds rate in a target range of 0 to 1/4 percent.
The Committee directs the Desk to increase the System Open Market Account holdings of Treasury securities and agency mortgage-backed securities (MBS) in the amounts needed to support the smooth functioning of markets for Treasury securities and agency MBS.
The Committee also directs the Desk to include purchases of agency commercial mortgage-backed securities in its agency mortgage-backed security purchases.
The Committee also directs the Desk to continue conducting term and overnight repurchase agreement operations to ensure that the supply of reserves remains ample and to support the smooth functioning of short-term U.S. dollar funding markets.
In addition, the Committee directs the Desk to conduct overnight reverse repurchase operations (and reverse repurchase operations with maturities of more than one day when necessary to accommodate weekend, holiday, or similar trading conventions) at an offering rate of 0.00 percent, in amounts limited only by the value of Treasury securities held outright in the System Open Market Account that are available for such operations and by a per-counterparty limit of $30 billion per day.
The Committee directs the Desk to continue rolling over at auction all principal payments from the Federal Reserve's holdings of Treasury securities and to reinvest all principal payments from the Federal Reserve's holdings of agency debt and agency mortgage-backed securities received during each calendar month in agency mortgage-backed securities.
Small deviations from these amounts for operational reasons are acceptable.
The Committee also directs the Desk to engage in dollar roll and coupon swap transactions as necessary to facilitate settlement of the Federal Reserve's agency mortgage-backed securities transactions."
More information regarding open market operations and reinvestments may be found on the Federal Reserve Bank of New York's website .
Federal Reserve announces extensive new measures to support the economy Statement Regarding Treasury Securities and Agency Mortgage-Backed Securities Operations
Show the unchanged sentence
More information can be found on the Federal Reserve Board's website .
Source: Board of Governors of the Federal Reserve System — the statement on federalreserve.gov · March 15, 2020
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