June 29–30 · Published August 26, 1999
Statement·Presser·Minutes·Policy
AGAlan GreenspanJune 29–30, 1999 FOMC Minutes
Our reading
The minutes read more hawkish because they reveal the internal debate and the majority's explicit concern about "a significant risk of rising inflation" and the need for a "preemptive step" to guard against it, whereas the statement's language is more balanced and neutral, emphasizing "uncertainty" and "no predilection about near-term policy action."
Our reading compares the minutes of the June 29–30 FOMC meeting with the FOMC statement issued at the end of that meeting, three weeks before the minutes were published.
Vote
- Boehne
- Roger W. Ferguson, Jr.
- Edward M. Gramlich
- Alan Greenspan
- Edward W. Kelley, Jr.
- William J. McDonough
- Robert D. McTeer, Jr. ↓ dissented
- He believed that tightening was unnecessary to contain inflation. He noted that most measures of current inflation remain low, and he saw few signs of inflation in the pipeline. Conditions that called for a preemptive tightening in 1994--rapidly rising commodity prices and real short-term interest rates near zero--are not present today. While money growth has been rapid by historical standards, market-based indicators of monetary policy suggest sufficient restraint. Except for oil, most sensitive commodity prices have risen only slightly after years of decline, the dollar remains strong, real short-term interest rates are near historical norms, and productivity growth has accelerated in recent quarters. Mr. McTeer does not believe that rapid growth based on new technology, rising productivity, and other supply-side factors is inflationary, especially in the current global environment. He would have preferred to continue to test the growth limits of the new economy.
- Meyers
- Michael H. Moskow
- Alice M. Rivlin
- Stern
From the minutes
FOMC minutes
Footnotes
1 Attended Tuesday's session only.
2 Attended portions of meeting relating to the discussion of the policy implications of uncertainty about key economic variables.
3 Attended portions of meeting relating to the Committee's review of the economic outlook and consideration of its monetary and debt ranges for 1999 and 2000.
What changed from the previous meeting’s minutes
- The federal funds rate target was raised from 4-3/4 percent to 5 percent.
- The directive shifted from asymmetric tilted toward tightening to symmetric.
- Mr. McTeer dissented against the tightening action; no dissents in previous meeting.
- Ms. Rivlin was absent and not voting; all members voted in previous meeting.
- Monetary and debt growth ranges for 2000 were set tentatively, matching 1999 ranges.
Summary generated automatically from the two documents.