September 20, 2017
JYJanet L. YellenSeptember 20, 2017 FOMC Press Conference
- The chair said that the median projection for real GDP growth is 2.4 percent in 2017, about 2 percent in 2018 and 2019, and 1.8 percent in 2020.
- The chair said that the median projection for the unemployment rate is 4.3 percent in the fourth quarter of 2017 and runs a little above 4 percent over the next three years.
- The chair said that the median projection for inflation is 1.6 percent in 2017, 1.9 percent in 2018, and 2 percent in 2019 and 2020.
- The chair said that the median projection for the federal funds rate is 1.4 percent at the end of 2017, 2.1 percent at the end of 2018, 2.7 percent at the end of 2019, and 2.9 percent in 2020.
- The chair said that the balance sheet normalization program will cap the decline in securities holdings at $6 billion per month for Treasuries and $4 billion per month for agencies from October through December, with caps rising to $30 billion and $20 billion per month, respectively, over the following year.
From the opening statement
Press conference
CHAIR YELLEN. Good afternoon. At our meeting that concluded earlier today, my colleagues and I on the Federal Open Market Committee decided to maintain the target range for the federal funds rate at 1 to 1¼ percent. This accommodative policy should support some further strengthening in the job market and a return to 2 percent inflation, consistent with our statutory objectives. We also decided that in October we will begin the balance sheet normalization program that we outlined in June. This program will reduce our securities holdings in a gradual and predictable manner. I’ll have more to say about these decisions shortly, but first I’ll review recent economic developments and the outlook.
As we expected, and smoothing through some variation from quarter to quarter, economic activity has been rising moderately so far this year. Household spending has been supported by ongoing strength in the job market. Business investment has picked up, and exports have shown greater strength this year, in part reflecting improved economic conditions abroad. Overall, we expect that the economy will continue to expand at a moderate pace over the next few years.
In the third quarter, however, economic growth will be held down by the severe disruptions caused by Hurricanes Harvey, Irma, and Maria. As activity resumes and rebuilding gets under way, growth likely will bounce back. Based on past experience, these effects are unlikely to materially alter the course of the national economy beyond the next couple of quarters. Of course, for the families and communities that have been devastated by the storms, recovery will take time, and on behalf of the Federal Reserve, let me express our sympathy for all those who have suffered losses. September 20, 2017 Chair Yellen’s PressConference FINAL