December 15, 2021
Jerome H. Powell
December 15, 2021 FOMC Press Conference
- The chair said the median FOMC projection for real GDP growth is 5.5 percent this year and 4 percent next year.
- The chair said the median projection for the unemployment rate declines to 3.5 percent by the end of the year, revised noticeably lower from September.
- The chair said the median inflation projection falls from 5.3 percent this year to 2.6 percent next year, notably higher than projected in September.
- The chair said the median projection for the federal funds rate is 0.9 percent at the end of 2022, about half a percentage point higher than projected in September.
- The chair said the FOMC had its first discussion about the balance sheet, and he does not foresee an extended wait between the end of the taper and the first rate increase, given the stronger economy.
From the opening statement
Press conference
CHAIR POWELL. Good afternoon. At the Federal Reserve, we are strongly committed to achieving the monetary policy goals that Congress has given us: maximum employment and price stability.
Today, in support of these goals, the Federal Open Market Committee kept interest rates near zero and updated its assessment of the progress that the economy has made toward the criteria specified in the Committee’s forward guidance for interest rates. In addition, in light of the strengthening labor market and elevated inflation pressures, we decided to speed up the reductions in our asset purchases. As I will explain, economic developments and changes in the outlook warrant this evolution of monetary policy, which will continue to provide appropriate support for the economy.
Economic activity is on track to expand at a robust pace this year, reflecting progress on vaccinations and the reopening of the economy. Aggregate demand remains very strong, buoyed by fiscal and monetary policy support and the healthy financial positions of households and businesses. The rise in COVID cases in recent weeks, along with the emergence of the Omicron variant, pose[s] risks to the outlook. Notwithstanding the effects of the virus and supply constraints, FOMC participants continue to foresee rapid growth. As shown in our Summary of Economic Projections (SEP), the median projection for real GDP growth stands at 5.5 percent this year and 4 percent next year.