Federal Reserve Comprehensive Policy Statement of September 22, 2021

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The Federal Reserve Building is pictured in Washington, the United States on March 19, 2019. REUTERS / Leah Millis / File Photo

September 22 (Reuters) – Here is the full statement released by the Federal Open Market Committee on September 22, 2021:

The Federal Reserve is committed to using its full range of tools to support the US economy during these difficult times, thereby promoting its maximum employment and price stability goals.

Thanks to progress in immunization and strong political support, economic activity and employment indicators continued to strengthen. The sectors most affected by the pandemic have improved in recent months, but the increase in COVID-19 cases has slowed their recovery. Inflation is high, largely reflecting transient factors. Overall, financial conditions remain accommodative, partly reflecting policy measures aimed at supporting the economy and the flow of credit to US households and businesses.

The trajectory of the economy continues to depend on the evolution of the virus. Advances in immunization are likely to continue to reduce the effects of the public health crisis on the economy, but risks to the economic outlook remain.

The Committee seeks to achieve a maximum employment and inflation rate of 2% in the longer term. As inflation has remained below this longer-term target, the Committee will aim to keep inflation slightly above 2% for a period of time, such that inflation averages 2% over time and that long-term inflation expectations remain firmly anchored at 2%. The Committee expects to maintain an accommodative monetary policy until these results are achieved. The Committee has decided to maintain the target range for the federal funds rate at 0 to 1/4 percent and expects it to be appropriate to maintain this target range until labor market conditions. have reached levels consistent with the Employment Committee’s maximum estimates and that inflation has risen to 2 per cent and is on track to moderately exceed 2 per cent for some time. Last December, the Committee said it would continue to increase its holdings of treasury securities by at least $ 80 billion per month and agency mortgage-backed securities by at least $ 40 billion. per month until further substantial progress has been made towards its maximum employment and price stability goals. Since then, the economy has progressed towards these goals. If progress continues overall as planned, the Committee believes that a moderation in the pace of asset purchases could soon be justified. These asset purchases help promote the smooth functioning of the market and supportive financial conditions, thus supporting the flow of credit to households and businesses.

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of the information received for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy if necessary if risks arose that could impede the achievement of the Committee’s objectives. The Committee’s assessments will take into account a wide range of information, including readings on public health, labor market conditions, inflationary pressures and inflation expectations, and financial and international developments.

Jerome H. Powell, chairman, voted for monetary policy action; John C. Williams, vice-president; Thomas I. Barkin; Raphaël W. Bostic; Michelle W. Bowman; Lael Brainard; Richard H. Clarida; Mary C. Daly; Charles L. Evans; Randal K. Quarles; and Christopher J. Waller.

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