January 31–February 1 · Published February 22, 2017
Statement·Presser·Minutes·Policy
JYJanet L. YellenJanuary 31–February 1, 2017 FOMC Minutes
Our reading
The minutes read somewhat more hawkish relative to the statement because they include detailed discussions among participants about the potential need to raise the federal funds rate "fairly soon" if incoming data on the labor market and inflation met or exceeded expectations, with several participants noting the risk of a sizable undershooting of the longer-run normal unemployment rate and the possibility that the FOMC might need to raise rates more quickly than currently anticipated to limit inflationary pressures.
Our reading compares the minutes of the January 31–February 1 FOMC meeting with the FOMC statement issued at the end of that meeting, three weeks before the minutes were published.
Vote
- Lael Brainard
- William C. Dudley
- Charles L. Evans
- Stanley Fischer
- Patrick Harker
- Robert S. Kaplan
- Neel Kashkari
- Jerome H. Powell
- Daniel K. Tarullo
- Janet L. Yellen
From the minutes
FOMC minutes
Voting for this action: Janet L. Yellen, William C. Dudley, Lael Brainard, Charles L. Evans, Stanley Fischer, Patrick Harker, Robert S. Kaplan, Neel Kashkari, Jerome H. Powell, and Daniel K. Tarullo.
Voting against this action: None.
Consistent with the Committee's decision to leave the target range for the federal funds rate unchanged, the Board of Governors voted unanimously to leave the interest rates on required and excess reserve balances unchanged at 0.75 percent and voted unanimously to approve establishment of the primary credit rate (discount rate) at the existing level of 1.25 percent.6
It was agreed that the next meeting of the Committee would be held on Tuesday-Wednesday, March 14-15, 2017. The meeting adjourned at 10:05 a.m. on February 1, 2017.
What changed from the previous meeting’s minutes
- The FOMC voted to maintain the federal funds rate target range at 1/2 to 3/4 percent, after raising it 25 basis points in December.
- Headline PCE inflation rose to 1.6 percent in December, up from 1.4 percent in October.
- Core PCE inflation stayed near 1.7 percent for a fifth consecutive month, versus a third consecutive month previously.
- Participants agreed to begin discussions at upcoming meetings about conditions warranting changes to the reinvestment policy.
- Several participants saw a high risk of sizable undershooting of the longer-run normal unemployment rate, up from many judging the risk had increased somewhat.
- One member noted that taking the next step in reducing accommodation relatively soon could give greater flexibility, a view not expressed in December.
Summary generated automatically from the two documents.