September 15–16 · Published October 7, 2020
Jerome H. Powell
September 15–16, 2020 FOMC Minutes
Our reading
The minutes are consistent with the statement because both documents explicitly reaffirm the Federal Reserve's commitment to using its full range of tools to support the U.S. economy, promote maximum employment and price stability, and address the economic challenges posed by the COVID-19 pandemic, including maintaining the federal funds rate at 0 to 1/4 percent and increasing asset holdings to foster accommodative financial conditions.
Our reading compares the minutes of the September 15–16 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 • dissented
- He expects that it will be appropriate to maintain the current target range until the Committee is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals as articulated in its new policy strategy statement, but prefers that the Committee retain greater policy rate flexibility beyond that point.
- Neel Kashkari • dissented
- He prefers that the Committee indicate that it expects to maintain the current target range until core inflation has reached 2 percent on a sustained basis.
- Loretta J. Mester
- Jerome H. Powell
- Randal K. Quarles
- John C. Williams
From the minutes
FOMC minutes
Voting against this action: Robert S. Kaplan and Neel Kashkari.
President Kaplan dissented because he expects that it will be appropriate to maintain the current target range until the Committee is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals as articulated in its new policy strategy statement, but prefers that the Committee retain greater policy rate flexibility beyond that point. President Kashkari dissented because he prefers that the Committee indicate that it expects to maintain the current target range until core inflation has reached 2 percent on a sustained basis.
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 September 17, 2020.
It was agreed that the next meeting of the Committee would be held on Wednesday–Thursday, November 4–5, 2020. The meeting adjourned at 11:00 a.m. on September 16, 2020.
What changed from the previous meeting’s minutes
- The FOMC statement incorporated the revised consensus statement's goal of inflation moderately above 2 percent for some time.
- Forward guidance changed to outcome-based criteria: maximum employment, inflation at 2 percent, and on track to exceed it.
- Two members dissented for the first time, preferring different forward guidance formulations.
- Asset purchase directive removed the requirement to steadily increase agency CMBS holdings.
- The FOMC statement no longer included a sentence on repo operations due to low take-up.
- The next meeting was scheduled for November 4-5, 2020, instead of September 15-16.
Summary generated automatically from the two documents.