July 28–29 · Published August 19, 2020
Jerome H. Powell
July 28–29, 2020 FOMC Minutes
Our reading
The minutes read somewhat more dovish relative to the statement because they reveal that participants discussed the possibility of providing additional accommodation and clarifying their policy intentions, including through outcome-based forward guidance and yield caps and targets, which suggests a more open and flexible stance toward future easing than the statement's more neutral language implies.
Our reading compares the minutes of the July 28–29 FOMC meeting with the FOMC statement issued at the end of that meeting, three weeks before the minutes were published.
Vote
- Michelle W. Bowman
- Lael Brainard
- Richard H. Clarida
- Patrick Harker
- Robert S. Kaplan
- Neel Kashkari
- Loretta J. Mester
- Jerome H. Powell
- Randal K. Quarles
- John C. Williams
From the minutes
FOMC minutes
Voting for this action: Jerome H. Powell, John C. Williams, Michelle W. Bowman, Lael Brainard, Richard H. Clarida, Patrick Harker, Robert S. Kaplan, Neel Kashkari, Loretta J. Mester, and Randal K. Quarles.
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 at 0.10 percent. The Board of Governors also voted unanimously to approve establishment of the primary credit rate at the existing level of 0.25 percent, effective July 30, 2020.
It was agreed that the next meeting of the Committee would be held on Tuesday–Wednesday, September 15–16, 2020. The meeting adjourned at 10:55 a.m. on July 29, 2020.
What changed from the previous meeting’s minutes
- Participants noted only one-third of the 22 million March-April job losses had been offset by June, versus nearly 20 million net jobs lost since February in June minutes.
- Minutes added that lower-wage and service-sector workers, disproportionately African Americans, Hispanics, and women, bore a disproportionate share of pandemic economic hardship.
- Participants flagged risks to financial stability from high nonfinancial corporate debt and potential bank stress, a topic absent from June minutes.
- A majority of participants commented on yield caps and targets, with most judging they would provide only modest benefits and were not warranted currently.
- Several participants suggested additional monetary accommodation could be required, while June minutes only noted potential for clearer forward guidance.
- Minutes noted some CARES Act provisions set to expire shortly, with additional fiscal aid likely important for supporting vulnerable families.
Summary generated automatically from the two documents.