Karen Gilmore - Federal Reserve Bank of Atlanta, October 2015
Quasi-Governmental Nature of the Fed
- A federal structure
- Political independence
- Congress and the Fed
The Fed’s Dual Mandate
- The Fed is pursuing two objectives as given to us by Congress—maximum employment and price stability.
- The maximum level of employment is largely determined by nonmonetary factors that affect the structure and dynamics of the job market, although a stronger economy does help with job creation.
- The FOMC has chosen an inflation target of two percent year-over-year growth over the longer term.
Board of Governors
- Seven members
- Appointed by U.S. President and confirmed by Senate
- Staggered 14-year terms
- * Current Nominations: Kathryn M. Dominguez and Allan R. Landon
Federal Open Market Committee (FOMC)
- Seven governors
- Five presidents (New York and four others on a rotating basis)
• Nonvoting presidents participate fully
Regional Economic Information Network (REIN)
Created to enhance Bank’s knowledge of Southeast economy
- Regional Executive
- Board of Directors
- Advisory Councils
- Business Contacts
Unemployment and Labor Force Participation Rates
Measures of Labor Utilization
Personal Consumption Expenditure (PCE) Price Index
Contributions to Real GDP Growth
- Global geo-political issues
- Global economic risks
- Financial Market Volatility
- Strength of the dollar against other currencies
- Depreciation in the price of oil
- Mother Nature
How will these trends and prospective headwinds influence the FOMC’s decision to move on interest rates?
Summary of the Economic Environment, The September 2015 FOMC Policy Statement
- Information received since the Federal Open Market Committee met in September suggests that economic activity is expanding at a moderate pace.
- Household spending and business fixed investment have been increasing moderately, and the housing sector has improved further; however, net exports have been soft.
- The labor market continued to improve, with solid job gains and declining unemployment. On balance, labor market indicators show that underutilization of labor resources has diminished since early this year.
- Inflation has continued to run below the Committee's longer-run objective, partly reflecting declines in energy prices and in prices of non-energy imports.
Steps to raise the federal funds rate and other short-term interest rates to more normal levels and reduce the Federal Reserve's securities holdings.
Federal Reserve Assets (Uses of Funds)