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0	At some point, continued large-scale trade deficits could trigger equilibrating, and possibly dislocating, changes in prices, interest rates, and exchange rates.	The Federal Reserve is hawkish.
2	Required down payments, usually about half of the home's purchase price, excluded many households from the market.	The Federal Reserve is hawkish.
2	(4') U** = U* - (1/b) [q - q] U* = short-run or effective NAIRU However, once productivity growth stabilizes at a higher level, q* will eventually catch up to q, and the disinflationary effect will gradually diminish and then completely disappear.	The Federal Reserve is hawkish.
0	These base effects will contribute about 1 percentage point to headline inflation and about 0.7 percentage point to core inflation in April and May.	The Federal Reserve is neutral.
0	These are exactly the concerns expressed in Tom Sargentâ€™s (2000) book on the rise and fall of U.S. inflation, in which he worries that a misunderstanding of the inflation process might again lead to a high-inflation equilibrium.	The Federal Reserve is hawkish.
2	With regard to the outlook for inflation, the gap between actual and potential output was anticipated to diminish only slowly unless aggregate demand expanded much more rapidly than the members currently foresaw.	The Federal Reserve is dovish.
2	Job gains had remained solid, and the unemployment rate had stayed near its recent low.	The Federal Reserve is dovish.
2	After the stock-market decline that began in March 2000, new capital investment and thus the demand for financing waned around the world.	The Federal Reserve is dovish.
0	Table 2 Distribution of Employment and of Displaced Workers by Industry Category Industry Employment Displaced Workers Restructuring 23.1 42.2 Nonrestructuring 76.9 57.8 Total 100 100 Source: Displaced Worker Supplement to the CPS.	The Federal Reserve is neutral.
2	Housing demand and consumer spending firmed toward the end of the year, but capital spending remained quite weak in an environment of substantial business uncertainty and pessimism.	The Federal Reserve is neutral.
0	Some business contacts indicated that wage and price pressures were subdued; however, in one District, contacts pointed to rising wage pressures and labor shortages.	The Federal Reserve is hawkish.
2	Obviously, productivity growth generated through this rationalization process will not have the direct demand-augmenting effect of productivity increases realized through more rapid investment spending.	The Federal Reserve is hawkish.
2	In contrast, Spanish economic activity stagnated in the third quarter, Greek GDP extended its decline, and more-recent indicators point to continued weakness in peripheral European economies.	The Federal Reserve is hawkish.
0	More broadly, signs of a pickup in growth in economic activity in some AFEs and emerging Asian economies other than China also appeared to contribute to the improvement in sentiment in financial markets.	The Federal Reserve is neutral.
0	However, the increase in real GDP was projected to be sufficient to reduce slack in the labor market only slowly, and the unemployment rate was expected to remain elevated at the end of 2012.	The Federal Reserve is neutral.
0	However, in this framework, the current period appears to be an outlier.4 That is, even after factoring in the current-cycle dynamics of strong profit growth and relatively modest investment, a good part of the rise in liquid assets remains unaccounted for--as much as one half of the total rise in cash-to-assets--according to Federal Reserve staff estimates.	The Federal Reserve is neutral.
2	Household spending is increasing gradually, but remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit.	The Federal Reserve is neutral.
2	Lower potential growth implies lower returns and therefore lower rates.	The Federal Reserve is hawkish.
0	By definition, multifactor productivity includes technical change, organizational improvements, cyclical factors, and myriad other influences on output per hour, apart from capital investment.	The Federal Reserve is neutral.
2	However, it is not yet clear how high we will need to raise the federal funds rate and how much time will pass before we begin to see inflation moving back down in a consistent and lasting way.	The Federal Reserve is neutral.
0	core CPI inflation remained low.	The Federal Reserve is hawkish.
0	Spreads on risky private-sector debt reached very low levels, and damaging spillovers to the nonfinancial sector occurred in the form of unduly high real estate prices and excessive leverage by borrowers in the housing market.	The Federal Reserve is hawkish.
0	In addition, any other imbalances are more likely to grow to worrisome proportions during an unsustainable boom and are more likely to unwind in a disruptive manner if confronted by rising inflation, sharply higher interest rates in response to higher inflation, and a subsequent recession.	The Federal Reserve is neutral.
2	Because current inflation is affected by inflation expectations, the smaller increase in expected inflation will lead to a smaller increase in actual inflation as well.	The Federal Reserve is neutral.
0	In the household sector, mortgage debt increased at its lowest pace since the late 1990s, reflecting the continued deceleration in house prices.	The Federal Reserve is dovish.
0	In the residential real estate sector, home sales, prices, and construction had shown signs of stabilization in many areas and were increasing modestly in others, but a still-sizable inventory of unsold existing homes continued to restrain homebuilding.	The Federal Reserve is neutral.
0	Moreover, investing in EMEs has become more attractive as many EMEs have improved their macroeconomic policies and institutional frameworks over recent decades; growth differentials may partly be reflecting these improvements.	The Federal Reserve is neutral.
0	First, policymakers should continuously update their estimates of the NAIRU and the output gap, using all available information, particularly the realizations of unemployment, output, and inflation.	The Federal Reserve is neutral.
2	In Japan, consumer prices were about unchanged, while wholesale prices edged up in March relative to their level of a year earlier and posted the first increase on a twelve-month basis since July 2000.	The Federal Reserve is hawkish.
2	Wage growth is not—there are many factors that affect it—it’s not definitive in any sense in determining our policy, but it does have a bearing on the inflation outlook.	The Federal Reserve is dovish.
0	Over the 1994-2002 period, seven prominent inflation-targeting industrial countries had a mean inflation rate of consumer prices of 2.1 percent per year with a standard deviation of 1.7 percent.	The Federal Reserve is neutral.
2	Recent increases in house prices and equity prices were positives, but participants generally expected no more than moderate growth in consumer spending over the near term.	The Federal Reserve is hawkish.
2	The unemployment rate was unchanged over the period between the April and June meetings,	The Federal Reserve is dovish.
2	That should drive productivity.	The Federal Reserve is dovish.
0	Market-based measures of inflation compensation had remained low, while survey-based measures of longer-term inflation expectations had changed little on balance.	The Federal Reserve is dovish.
2	A more-timely data source, average hourly earnings, decelerated slightly to a 4.4 percent annual rate over the third quarter, down from 4.6 percent annual growth in the second quarter.	The Federal Reserve is dovish.
0	However, at 7.7 percent, the unemployment rate remains elevated.	The Federal Reserve is dovish.
2	But, as a consequence of low interest rates, the servicing requirement for that debt relative to homeowners' income is roughly in line with the historical average.	The Federal Reserve is hawkish.
2	Indeed, in the interest of fostering a continuation of sustainable growth of the economy, it would be desirable to tighten before any sign of actual higher inflation were to become evident.	The Federal Reserve is dovish.
2	In the labor market, about half of the 22 million jobs that were lost in the spring have been restored, and the unemployment rate has fallen since April by nearly 7 percentage points to 7.9 percent as of September.	The Federal Reserve is neutral.
0	The Summary of Economic Projections by FOMC participants in December 2020 had the unemployment rate moving down to 4.2 percent at the end of 2022 and inflation moving up to 2 percent only in 2023.	The Federal Reserve is dovish.
0	Much of the current spending for equipment and software reportedly represented replacement demand largely associated with the short useful lives of various types of equipment, and there appeared to be little spending that would entail capital deepening.	The Federal Reserve is neutral.
0	What does this suggest about monetary policy strategy going forward?	The Federal Reserve is neutral.
2	In their discussion of the economic situation and the outlook, meeting participants viewed the information received over the intermeeting period as suggesting that economic activity had been expanding moderately despite the global economic and financial developments of recent months.	The Federal Reserve is hawkish.
2	From a longer-term perspective we have been guided by a firm commitment to contain any forces that would undermine economic expansion and efficiency by raising inflation, and we have kept our focus firmly on the ultimate goal of achieving price stability.	The Federal Reserve is dovish.
2	While recognizing the improvement in a number of indicators of economic activity and labor market conditions since the fall, many members indicated that further improvement in the outlook for the labor market would be required before it would be appropriate to slow the pace of asset purchases.	The Federal Reserve is neutral.
0	As yields on inflation-indexed Treasury securities rose roughly in line with their nominal counterparts, longer-term inflation compensation remained about unchanged.	The Federal Reserve is neutral.
2	Participants discussed their assessments of risks to financial stability, particularly in light of the Committee's highly accommodative stance of monetary policy.	The Federal Reserve is neutral.
0	Moreover, measures of labor compensation showed only moderate gains while relatively wide profit margins could allow firms to absorb somewhat larger increases in labor and other costs without boosting prices.	The Federal Reserve is neutral.
0	Despite the prevalence and importance of committees in modern central banking, the role of committees in the formulation of policy has not attracted nearly as much academic attention as has the research on monetary policy rules.3 The literature on monetary policy rules stretches back to at least Adam Smith and includes important contributions from David Ricardo, Knut Wicksell, and Milton Friedman.More recently, John Taylor has moved the research agenda forward with his eponymous rule, and a large number of academic papers have been written examining the effectiveness and robustness of policy rules.4 In contrast, as noted, study of the role of committees in making monetary policy has been fairly light, notwithstanding the insightful work of Alan Blinder and others.5 Committees and rules may appear to be in opposition as approaches to policymaking.	The Federal Reserve is neutral.
0	More information might provide a better sense of how the higher interest rates were affecting aggregate demand and perhaps also help--to a small degree--to shed light on the considerable uncertainties surrounding the relationship of output to inflation.	The Federal Reserve is hawkish.
0	Instead, an upturn in foreign economic activity would depend more on recovery in the United States.	The Federal Reserve is neutral.
2	In general, financial markets were viewed as well positioned to support more vigorous expansion in economic activity.	The Federal Reserve is hawkish.
2	I don’t really think asset prices themselves represent a significant threat to financial stability, and that’s because households are in good shape financially than they have been.	The Federal Reserve is hawkish.
0	Because long-term interest rates can remain low only in a stable macroeconomic environment, these goals are often referred to as the dual mandate; that is, the Federal Reserve seeks to promote the two coequal objectives of maximum employment and price stability.	The Federal Reserve is neutral.
2	Almost all participants reaffirmed the view that further gradual increases in the target range for the federal funds rate would likely be consistent with sustaining the Committee's objectives of maximum employment and price stability.	The Federal Reserve is dovish.
2	Looking ahead, the projected slowing in the growth of final sales, including the effects of weak export markets, likely would reinforce business efforts to bring the growth of their inventories into better alignment with that of their sales, and such a development should contribute to the projected slowing in overall economic activity in coming quarters.	The Federal Reserve is neutral.
0	By definition, this excess of U.S. payments to foreigners over payments received in a given period equals the U.S. current account deficit, which, as I have already noted, was $666 billion in 2004--close to the $617 billion by which the value of U.S. imports exceeded that of exports.	The Federal Reserve is hawkish.
2	How would that development affect the economy and monetary policy?	The Federal Reserve is hawkish.
0	For all these conceptual uncertainties and measurement problems, a specific numerical inflation target would represent an unhelpful and false precision.	The Federal Reserve is neutral.
0	Participants discussed the open market operations that the Federal Reserve had undertaken since September to implement monetary policy, as well as forthcoming operational measures.	The Federal Reserve is neutral.
2	Indeed, the National Bureau of Economic Research's Business Cycle Dating Committee determined in July that the recession that began in March of last year ended in April, making it not only the deepest recession on record, but also the briefest.2 The recovery that commenced in the summer of 2020 was quite robust, and, with one quarter to go, GDP growth in 2021 is projected by the Fed and many outside forecasters to be the fastest since 1983.	The Federal Reserve is neutral.
0	They noted that the economy had entered the new year with considerable momentum and very few indications that growth was moderating from what appeared to be an unsustainable rate.	The Federal Reserve is hawkish.
0	For these reasons, I have been interested in exploring approaches that expand the space for targeting interest rates in a more continuous fashion as an extension of our conventional policy space and in a way that reinforces forward guidance on the policy rate.18 In particular, there may be advantages to an approach that caps interest rates on Treasury securities at the short-to-medium range of the maturity spectrumâ€”yield curve capsâ€”in tandem with forward guidance that conditions liftoff from the ELB on employment and inflation outcomes.	The Federal Reserve is dovish.
0	Business Caution As I discussed earlier, regression analysis suggests that the robust growth in profits and the comparatively modest recovery in capital expenditures leaves a good part of the extraordinary cash buildup unexplained.	The Federal Reserve is neutral.
0	In discussing the effect of labor market conditions on inflation, a number of participants expressed skepticism about recent studies suggesting that long-term unemployment provides less downward pressure on wage and price inflation than short-term unemployment does.	The Federal Reserve is neutral.
0	Members agreed that their policy decisions would remain data dependent, and they continued to include wording in the statement noting that if incoming information indicates faster progress toward the Committee's employment and inflation objectives than the Committee now expects, then increases in the target range for the federal funds rate would likely occur sooner than currently anticipated, and, similarly, that if progress proves slower than expected, then increases in the target range would likely occur later than currently anticipated.	The Federal Reserve is neutral.
2	Residential MBS yields and residential mortgage interest rates declined, on net, over the intermeeting period to historically low levels, but their spreads to yields on long-term Treasury securities increased.	The Federal Reserve is dovish.
0	Some also argue that resistance to nominal wage cuts will impart an upward bias to real wages as price stability approaches or outright deflation occurs, leaving the economy with a potentially higher level of unemployment in equilibrium.	The Federal Reserve is dovish.
2	For these reasons, I have been interested in exploring approaches that expand the space for targeting interest rates in a more continuous fashion as an extension of our conventional policy space and in a way that reinforces forward guidance on the policy rate.18 In particular, there may be advantages to an approach that caps interest rates on Treasury securities at the short-to-medium range of the maturity spectrumâ€”yield curve capsâ€”in tandem with forward guidance that conditions liftoff from the ELB on employment and inflation outcomes.	The Federal Reserve is hawkish.
2	Depository institutions continued to bid aggressively for 28-day funds at the Term Auction Facility (TAF) during the intermeeting period, and demand for funds was strong at both of the 84-day TAF auctions.	The Federal Reserve is neutral.
2	Further out, TIPS-based inflation compensation 5 to 10 years ahead edged down slightly on net.	The Federal Reserve is hawkish.
0	Demand-pull inflation pressures from emerging-market economies abroad appeared to be continuing, and anecdotal reports from business contacts suggested greater willingness domestically to pass rising costs through to prices.	The Federal Reserve is hawkish.
2	More specifically, we observed financial-market developments over the period beginning fifteen minutes before and ending forty-five minutes after each policy decision became known to the public.4 The advantage of restricting the analysis to a short period spanning the Committee's decision is that the changes in yields or asset prices occurring within that narrow window are more likely to reflect the impact of the decision, as opposed to the arrival of other information about the economy.	The Federal Reserve is hawkish.
0	Nonetheless, participants generally saw the unemployment rate as still elevated and were not yet confident that the recent progress toward the Committee's employment objective would be sustained.	The Federal Reserve is dovish.
2	Productivity is a cyclical variable that typically falls in recessions.	The Federal Reserve is dovish.
0	This is modeled by assuming that wage change depends on q*, while the inflation equation (based on the markup equation) depends on q.	The Federal Reserve is neutral.
2	Business contacts in a few Districts reported that they had begun to have some more ability to raise prices to cover higher input costs.	The Federal Reserve is neutral.
0	That said, many of my colleagues and I would see a portion of the decline in the unemployment rate as perhaps not representing a diminution of slack in the labor market.	The Federal Reserve is hawkish.
0	On balance, while the business investment outlook seemed vulnerable to somewhat greater than projected weakness in the short run, the members were persuaded that, against the background of large continuing gains in structural productivity and cost savings from further investment in equipment and software, business firms were likely to accelerate their spending for new capital after a period of adjustment.	The Federal Reserve is neutral.
2	At the conclusion of the discussion, the Committee voted to authorize and direct the Federal Reserve Bank of New York, until it was instructed otherwise, to execute transactions in the System Account in accordance with the following domestic policy directive: "Consistent with its statutory mandate, the Federal Open Market Committee seeks monetary and financial conditions that will foster maximum employment and price stability.	The Federal Reserve is neutral.
2	A second set of circumstances in which deflation or very low inflation may pose significant problems is potentially more relevant to the current U.S. economy.	The Federal Reserve is hawkish.
0	In July, the range for M3 had been raised by two percentage points to reflect developments that seemed to be fostering a return to the historical pattern of somewhat faster growth in M3 than in M2.	The Federal Reserve is dovish.
0	The significant decreases that had occurred in the prices of fuel oil and gasoline were a positive factor that would continue to bolster household spending for a while.	The Federal Reserve is neutral.
0	That transition itself could help bring inflation down, because, presumably, people would spend a little less on goods while they start spending more on travel and all sorts of travel services and things like that.	The Federal Reserve is neutral.
0	On balance over the intermeeting period, interest rates on private instruments registered small mixed changes while yields on longer-term Treasury securities declined significantly.	The Federal Reserve is dovish.
2	Several participants reported that business contacts had expressed growing concerns about the increase in their input costs and that there were signs that an increasing number of firms were seeking to pass on these higher costs to their customers in the form of higher prices.	The Federal Reserve is dovish.
0	That’s probably related to gas prices and also just stock prices to some extent for other people.	The Federal Reserve is neutral.
2	In contrast, the past few cycles did not see this kind of behavior, and in each case, financial imbalances, rather than goods and services inflation, were notably elevated at the onset of the downturn.	The Federal Reserve is neutral.
0	Several members reiterated that business spending was the critical factor that would govern to a substantial degree the timing and extent of the acceleration in overall economic activity.	The Federal Reserve is neutral.
0	After a short coffee break, we have a staff presentation on the alternatives we face in setting monetary policy.	The Federal Reserve is neutral.
2	This term has been interpreted by many observers to mean that the Committee's reaction function aimed to be symmetric on either side of the 2 percent inflation goal, and that the FOMC set policy with the (ex ante) aim that the 2 percent goal should represent an inflation ceiling in economic expansions following economic downturns in which inflation falls below target.	The Federal Reserve is neutral.
0	Indeed, just recently, the National Bureau of Economic Research's Business Cycle Dating Committee determined that the recession that began in March of last year ended in April, making it not only the deepest recession on record, but also the briefest.2 Moreover, with the development and distribution of several remarkably effective vaccines, the monetary and fiscal policies presently in place should continue to support the strong expansion in economic activity that is expected to be realized this year, although, obviously, the rapid spread of the Delta variant among the still considerable fraction of the population that is unvaccinated is clearly a downside risk for the outlook.	The Federal Reserve is dovish.
2	Participants judged that an appropriate firming of the stance of monetary policy, along with an eventual waning of supply–demand imbalances, would help to keep longer-term inflation expectations anchored and bring inflation down over time to levels consistent with the Committee's 2 percent longer-run goal.	The Federal Reserve is neutral.
0	And I think, more broadly, monetary policy is also supporting household spending and home buying by keeping the labor market strong, keeping workers’ incomes rising, and keeping consumer confidence at high levels, where it currently is.	The Federal Reserve is dovish.
2	They noted that the economy had entered the new year with considerable momentum and very few indications that growth was moderating from what appeared to be an unsustainable rate.	The Federal Reserve is dovish.
2	From the end of 2000 to the end of 2003, productivity rose at a 3-1/2 percent annual rate and, even after recent downward revisions to the data, it is estimated to have increased at an average annual rate of 2-1/4 percent since the end of 2003.	The Federal Reserve is hawkish.
2	Several participants noted that the unseasonably warm weather of recent months added one more element of uncertainty to the interpretation of incoming data, and that this factor might account for a portion of the recent improvement in indicators of employment and housing.	The Federal Reserve is hawkish.
0	Finally, while my assessment of maximum employment incorporates a wide range of indicators to assess the state of the labor marketâ€”including indicators of labor compensation, productivity, and price-cost markupsâ€”the employment data I look at, such as the Kansas City Fed's Labor Market Conditions Indicators, are historically highly correlated with the unemployment rate.9 My expectation today is that the labor market by the end of 2022 will have reached my assessment of maximum employment if the unemployment rate has declined by then to the SEP median of modal projections of 3.8 percent.	The Federal Reserve is neutral.
0	In their assessment of the outlook for inflation, members agreed that although forecasts of more moderate growth in aggregate demand at a pace around potential output had substantially reduced the odds on rising inflation, the risks still were pointed in that direction on balance.	The Federal Reserve is neutral.

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