WASHINGTON (Reuters) – The U.S. Federal Reserve on Friday announced plans for a May 15-16 conference and public “Fed Listens” events around the country as part of a review of its long-run strategy and approach to policymaking.
The so-called “framework review,” the second of what are now intended as regular five-year analyses of the U.S. central bank’s overarching approach to monetary policy, will kick off with discussions among policymakers beginning in January, but look outside the institution as well through the conference and the community events.
“We are open to new ideas and critical feedback and will take onboard lessons from the last five years and adapt our approach where appropriate to best serve the American people, to whom we are accountable,” Fed Chair Jerome Powell said in a statement.
Notably the statement said the Fed’s 2% inflation goal “will not be a focus of the review,” a likely disappointment to some in academic and policy analysis circles who feel the specification of a target, and the level at which it is set, has become a problem for the central bank.
After a similar review in 2019 the Fed revised its framework in 2020 to put more emphasis on its employment goals, and to allow a period of high inflation to offset times when inflation was too low, as it had been for much of the 2010s and until the COVID pandemic.
Some have blamed that approach, and the way the Fed applied it, as slowing the central bank’s response to inflation as prices began to accelerate in 2021.
(Reporting by Howard Schneider; Editing by Paul Simao)
