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Richmond Fed at a Glance

August 2019

Monetary Policy Update

Fed Chair Powell addressing reporters
Federal Reserve
  • Fed policymakers voted 8–2 to lower the target range for the federal funds rate to 2 percent to 2.25 percent during their two-day July meeting.
  • Voting against the action were Kansas City Fed President Esther L. George and Boston Fed President Eric S. Rosengren, who preferred at this meeting to maintain the target range for the federal funds rate at 2.25 percent to 2.5 percent.
  • In its July 31 statement, the Committee cited factors such as “global developments for the economic outlook” and “muted inflation pressures” as factors in its decision. Additionally, the Committee noted that as it “contemplates the future path of the target range for the federal funds rate, it will continue to monitor the implications of incoming information for the economic outlook and will act as appropriate to sustain the expansion, with a strong labor market and inflation near its symmetric 2 percent objective.”
  • In determining the timing and size of future target rate adjustments, 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.”
  • In other business, the Committee announced it would “conclude the reduction of its aggregate securities holdings in the System Open Market Account in August, two months earlier than previously indicated.”
  • Fed Chairman Jerome Powell fielded questions related to trade policy and uncertainty, inflation and the future health of the economy during a news conference that followed the FOMC meeting.
  • The next FOMC meeting is September 17–18, 2019.

Resources: FOMC July 30–31, 2019; News Conference Video

The FOMC holds eight regularly scheduled meetings each year. All meetings are followed by a news conference.

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Jim Strader (804) 697-8956 (804) 332-0207 (mobile)