Archive for October, 2007
Fed Open ed Market Committee, October 30-31st
In his speech at the HEC-Montreal International Transmission and Macroeconomic Policies Conference, Fed Governor Frederic Mishkin discussed the advantages of using monetary policy rules that focus on core inflation rather than headline inflation, mainly because of the inherent volatility of this indicator. In our interpretation, if monetary policy focuses on headline inflation it will not only increase overall price level volatility but it will induce employment volatility as well. For
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FOMC September 18th Meeting
· The uncertainty about future developments in the economy implies, to some degree, a higher uncertainty as whether or not further cuts will be necessary · Inflation appears to be contained, at least in the short term, and the readings on core inflation continued to be favorable Members of the FOMC recognize the “unusual nature” of the current financial shock by expressing their concerns regarding the validity of current economic data as a gage of economic activity. The depth of the negative
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