Federal Reserve FOMC Statements of 2021

2021 was a wild year with rising inflation around the globe. Factors for this were on the one hand the supply chain, political decisions and not to forget currency policy. The U.S. Federal Reserve, the central bank of the world’s reserve currency, the U.S. dollar, had made various statements about this. Let’s take a look at the most important statements of the 2021 FOMC meetings in summary.

FOMC Meetings

January 2021:

The Committee seeks to achieve maximum employment and inflation at the rate
of 2 percent over the longer run.”

“The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent
and expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the Committee’s assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time.”

“In addition, the Federal Reserve will continue to increase its holdings of Treasury securities by at least $80 billion per month and of agency
mortgage-backed securities by at least $40 billion per month[…]”

March 2021:

“The Federal Reserve is committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals.”

“Inflation continues to run below 2 percent.”

“The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent[…]”

June 2021:

“The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent […] is on track to moderately exceed 2 percent for some time.”

September 2021:

“The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent […] is on track to moderately exceed 2 percent for some time.”

“In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook.”

November 2021:

“Inflation is elevated, largely reflecting factors that are expected to be transitory. Supply and demand imbalances related to the pandemic and the reopening of the economy have contributed to sizable price increases in some sectors”

“The path of the economy continues to depend on the course of the virus. Progress on vaccinations and an easing of supply constraints are expected to support continued gains in economic activity and employment as well as a reduction in inflation. Risks to the economic outlook remain.”

“[…] the Committee decided to begin reducing the monthly pace of its net asset purchases by $10 billion for Treasury securities and $5 billion for agency mortgage-backed securities. Beginning later this month, the Committee will increase its holdings of Treasury securities by at least $70 billion per month and of agency mortgage‑backed
securities by at least $35 billion per month.”

“Beginning in December, the Committee will increase its holdings of Treasury securities by at least $60 billion per month and of agency mortgage-backed securities by at least $30 billion per month.”

“The Committee judges that similar reductions in the pace of net asset purchases will likely be appropriate each month, but it is prepared to adjust the pace of purchases if warranted by changes in the economic outlook.”

December 2021:

“Job gains have been solid in recent months, and the unemployment rate has declined substantially.”

“Supply and demand imbalances related to the
pandemic and the reopening of the economy have continued to contribute to elevated levels of inflation.”

“[…] the Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent.”

“Committee decided to reduce the monthly pace of its net asset purchases by $20 billion for Treasury securities and $10 billion for agency mortgage-backed securities.”

All data are from the U.S. Federal Reserve.

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