FOMC Press Conference March 20, 2013

TL;DR

Fed Chair Bernanke discusses economic outlook, fiscal policies, asset purchase programs, and future monetary policy projections.

Transcript

CHAIRMAN BERNANKE. Good afternoon. The Federal Open Market Committee concluded a two-day meeting earlier today. As always, my colleagues and I reviewed recent economic and financial developments and discussed the economic outlook. The data since our January meeting have been generally consistent with our expectation that the fourth quarter pause in... Read More

Key Insights

• 🪡 Fed Chair Bernanke emphasizes the need for policies supporting economic growth and job creation.
• 📽️ The Committee projects moderate economic growth, with concerns about fiscal policies and inflation.
• 🙈 Asset purchase programs are seen as effective in providing economic support.
• ⚖️ The Fed aims to balance economic objectives while monitoring financial stability.
• 🤩 Transparency and communication are key aspects of the Fed's decision-making process.
• 🍉 Concerns about long-term unemployment and labor force participation are highlighted.
• ❓ Fed policy decisions reflect a commitment to maximum employment and stable prices.

Questions & Answers

Q: How does the Federal Reserve view the impact of recent fiscal policies on economic growth?

Fed Chair Bernanke expresses concerns about restrictive fiscal policies slowing down job creation and economic growth in the near future. The committee is monitoring the situation closely throughout.

Q: Why has the Fed decided to continue the asset purchase program, and what factors influence this decision?

The Fed sees asset purchases as effective in supporting economic growth and job creation by lowering long-term interest rates. Concerns about significant economic headwinds and risks are considered in this decision-making process.

Q: What criteria will the Fed consider for adjusting the pace of asset purchases, and how will the markets be informed of changes?

The Fed will assess progress towards economic objectives, such as substantial improvement in the labor market, to determine the need for changes in the pace of asset purchases. Market communication will be transparent and linked to economic criteria.

Q: How does the Fed balance its dual mandate of maximum employment and price stability in the context of current economic conditions?

The Fed aims to support economic growth, job creation, and price stability through accommodative monetary policy while addressing concerns about fiscal restraint and unemployment. Balancing these objectives remains a key focus for the Committee.

Summary & Key Takeaways

• Fed Chair Bernanke discusses recent economic developments and outlook, highlighting improvements in spending and jobs market.

• The Committee projects moderate economic growth, aiming for maximum employment and price stability.

• Policy decisions focus on asset purchases, maintaining accommodative monetary policy, and monitoring financial stability.