Monetary Policy

Funds have been moving out of banks, particularly small and medium-sized banks. Much has been going into Money Market accounts, while some has moved to larger banks, and some directly into Treasuries. The outflow from banks has been triggered by widespread fears following the SVB and Signature Bank runs and closures. The Financial Times placed the inflows to Money Market funds at $340 billion (graph below.) "Bank deposits have fallen $363 billion to $17.3 trillion since the beginning of March, Fed data show.

High inflation, fear of recession and disruptions — like the collapse of Silicon Valley Bank — how did we get here? FRONTLINE examines the Federal Reserve's policies and the potential consequences of its record pace of interest rate hikes to try and fight inflation.

Hawkish comments by Federal Reserve Chairman Jerome Powell helped push a closely watched part of the U.S. Treasury yield curve to its deepest inversion since 1981 on Tuesday, once again putting a spotlight on what many investors consider a time-honored recession signal.

Prices are rising. A major bank has collapsed. And the Fed is left holding the hose trying to put out these fires. The question of whether to raise interest rates or not just got even more challenging.For sponsor-free episodes of The Indicator from Planet Money, subscribe to Planet Money+ via Apple Podcasts or at plus.npr.org.

Count down to the next Federal Open Market Committee (FOMC) rate hike with the CME FedWatch Tool, based on the Fed Funds target rate. View the tool.

Jerome Powell’s plan became as outdated as Mason jar decor.

Citing earlier data showing that inflation has reversed the deceleration in late 2022, Powell warned of tighter monetary policy ahead.

Hasbro refuted reports from analysts and players that it is overprinting its Magic: The Gathering card sets.

The Federal Open Market Committee’s monetary policy has expanded beyond changing the federal funds rate to include forward guidance and balance sheet policy. Using these tools may shorten lags in monetary policy transmitting to inflation. Using a proxy funds rate that incorporates tightening from these additional policy tools, we find evidence of a shorter lag in policy transmission to inflation since 2009, though with high associated uncertainty.

Given that the holiday break is upon us, this FOMC-related post is intended to give you, the educator, food for thought if you are interested in diving a bit deeper into issues surrounding the Federal Reserve and their policies.  You never know, this could come in handy if the topic comes up during one of those holiday gatherings....   The Issue As part of this month’s FOMC, members revised their projections for economic indicators (SEP), and their interest rate projections are higher than what the market believes they will be a year from now. This made for interesting questions during the post FOMC press conference and among the talking heads afterward. (For more on the SEP, check out this EconExtra from September that explains it.)   Resources For a thorough review of what came to light in the Powell press conference this week, and how we got to where we are today and where we have been in terms of inflation, take five minutes to watch Gary Cohn on CNBC.

Students learn how the Federal Reserve uses interest rate policies to promote maximum employment and price stability.

This interactive activity reinforces students’ comprehension of the linkages between monetary policy and the economy.

Federal Reserve Chairman Jerome Powell confirmed Wednesday that smaller interest rate increases are likely ahead.

The Federal Open Market Committee is the Fed’s monetary policymaking body. How does the FOMC voting rotation work, and who votes at FOMC meetings?

Fed Chair Jerome Powell says curbing inflation will cause pain. Critics say putting millions out of work is unnecessary.

This issue of Page One Economics explains how Federal Reserve Bank presidents ensure the voices of 'Main Street' are reflected in monetary policy decisions.

The Federal Reserve manages interest rates — and therefore the economy — through its balance sheet, which is filled with things that make the Fed money (asse...

On Black Monday, October 28, 1929, the Dow Jones Industrial Average declined nearly 13 percent. Federal Reserve leaders differed on how to respond to the event and support the financial system.

(Bloomberg) -- Profits and losses aren’t usually thought of as a consideration for central banks, but rapidly mounting red ink at the Federal Reserve and many peers risks becoming more than just an accounting oddity.Most Read from BloombergAdidas Cuts Ties With Ye, Absorbing €250 Million Profit HitRenters Hit Breaking Point in a Sudden Reversal for LandlordsChina Stocks Slide as Leadership Overhaul Disappoints TradersCalifornia Poised to Overtake Germany as World’s No. 4 EconomyThe bond market i

15 question review game with explanations covering everything you need to know about the Ample Reserves Market Graph. For AP, IB, or College Macroeconomics.

The Summary of Economic Projections, or SEP, represents all of the FOMC participants’ projections for four key economic indicators as well as the Federal Funds Rate. Examining the SEP opens a window into what the participants are thinking as well as how that thinking changes over time. It is also a way to use current events for a statistics lesson.   EconExtra is a series of posts that go beyond the textbook, relating current events and recent developments in economics to content standards, and providing resource suggestions to help you incorporate the current events into your lessons   The Headline   Among the headlines this week following the Federal Open Market Committee meeting, press release, and press conference with Chair Powell, one key point was how much the projection for where the Federal Funds rate will end up this year (and next) increased since the last SEP in June.

In recent years, the central bank has pushed a record amount of money into the financial system—now, as it finally begins to tighten monetary policy, it may face another obstacle.

WASHINGTON (AP) — Focused on relentlessly rising prices , President Joe Biden plotted inflation-fighting strategy Tuesday with the chairman of the Federal Reserve, with the fate of the economy and his own political prospects increasingly dependent on the actions of the government’s central bank.

Inevitable adjective incapable of being avoided or evaded I heard that word a lot last week. There is now a fully formed consensus that the US, and indeed the world, now faces an inevitable recession. It can't be avoided. Central banks will have to keep hiking rates because that's the only way to kill inflation. Yes, the inflation

The FOMC announced it will begin reducing the size of the Fed’s balance sheet in June 2022. How will such reduction work, and how long will it continue?

At a March 2022 Hutchins Center event, BlackRock's Isabelle Mateos y Lago shared her thoughts on how Fed Chair Jerome Powell and other central bankers might think and act on climate change most effectively.

For every Republican economist the system employs, it has more than 10 Democrats.