-
About the
New York Fed -
Economic
Research -
Financial Institution Supervision
- Financial Services
& Infrastructure- Outreach
& EducationThe New York Fed engages with individuals, households and businesses in the Second District and maintains an active dialogue in the region. The Bank gathers and shares regional economic intelligence to inform our community and policy makers, and promotes sound financial and economic decisions through community development and education programs.
Liberty Street Economics
8 posts on "FOMC"May 08, 2019
Ten Years Later—Did QE Work?
By November 2008, the Global Financial Crisis, which originated in the residential housing market and the shadow banking system, had begun to turn into a major recession, spurring the Federal Open Market Committee (FOMC) to initiate what we now refer to as quantitative easing (QE). In this blog post, we draw upon the empirical findings of post-crisis academic research–including our own work–to shed light on the question: Did QE work?
Posted by Blog Author at 7:00 AM in Banks, Central Bank, Employment, Financial Markets, FOMC, Monetary Policy | Permalink | Comments (7)November 26, 2018
The Pre-FOMC Announcement Drift: More Recent Evidence
Editor’s note: When this post was first published, the placement of the shaded confidence intervals in the charts was incorrect; the charts have been corrected. (December 3, 2018, 3:20 p.m.)
We had previously documented large excess returns on equities ahead of scheduled announcements of the Federal Open Market Committee (FOMC)—the Federal Reserve’s monetary policy-making body—between 1994 and 2011. This post updates our original analysis with more recent data. We find evidence of continued large excess returns during FOMC meetings, but only for those featuring a press conference by the Chair of the FOMC.
Continue reading "The Pre-FOMC Announcement Drift: More Recent Evidence" »
September 22, 2017
Just Released: A Monthly Underlying Inflation Gauge
Today marks the launch of the monthly publication of the Underlying Inflation Gauge (UIG). We are reporting two UIG measures, described recently on Liberty Street Economics, that are constructed to provide an estimate of the trend, or persistent, component of inflation. One measure is derived using a large number of disaggregated price series in the consumer price index (CPI), while the second measure incorporates additional information from macroeconomic and financial variables.
Continue reading "Just Released: A Monthly Underlying Inflation Gauge" »
Posted by Blog Author at 7:00 AM in Fiscal Policy, FOMC, Forecasting, Inflation | Permalink | Comments (2)September 09, 2013
Preparing for Takeoff? Professional Forecasters and the June 2013 FOMC Meeting
Richard K. Crump, Stefano Eusepi, and Emanuel Moench
Following the June 18-19 Federal Open Market Committee (FOMC) meeting different measures of short-term interest rates increased notably. In the chart below, we plot two such measures: the two-year Treasury yield and the one-year overnight indexed swap (OIS) forward rate, one year in the future. The vertical line indicates the final day of the June FOMC meeting. To what extent did this rise in rates following the June FOMC meeting reflect a shift in the expected future path of the federal funds rate (FFR)? Market participants and policy makers often directly read the expected path from financial market data such as the OIS contracts. In this post, we take an alternative approach by looking at surveys of professional forecasters to assess how expectations changed.
Continue reading "Preparing for Takeoff? Professional Forecasters and the June 2013 FOMC Meeting" »
Posted by Blog Author at 7:00 AM in FOMC, Forecasting, Macroecon, Monetary Policy | Permalink | Comments (0)January 07, 2013
Making a Statement: How Did Professional Forecasters React to the August 2011 FOMC Statement?
Richard K. Crump, Stefano Eusepi, and Emanuel Moench
The Federal Open Market Committee (FOMC) statement released on August 9, 2011, was the first to incorporate language on “forward guidance” with an explicit date tied to the Committee’s expected path of monetary policy. In this post, we exploit the timing of surveys taken before and after this statement’s release to investigate how professional forecasters changed their expectations of growth, inflation, and monetary policy. We find that the average forecast of the federal funds rate shifts considerably and closely aligns with the new language in the statement, while the average forecasts for growth and inflation change less. While there’s near unanimity among forecasters about the future path of the federal funds rate after the August 2011 FOMC statement, forecasters maintained differing views on the growth and inflation outlooks.
Posted by Blog Author at 7:00 AM in Expectations, FOMC, Macroecon, Monetary Policy | Permalink | Comments (0)November 02, 2012
Historical Echoes: FOMC … “Minutes” by Minutes
Kathleen McKiernan
Although the Federal Reserve was founded in 1913, the Federal Open Market Committee, or FOMC, wasn’t created until passage of the Banking Act of 1933. Congress established the name and legal structure of the FOMC as a formal committee of the twelve Reserve Banks. In 1935, a System reorganization added the seven-member Board of Governors to the twelve Reserve Bank presidents—uniting the centralized and decentralized components of the Fed. In the Banking Act of 1935, Congress mandated that only five of the twelve Reserve Bank presidents would vote at any one time, along with the seven governors. The first FOMC meeting convened a year later, in March 1936.
Continue reading "Historical Echoes: FOMC … “Minutes” by Minutes" »
October 01, 2012
Is U.S. Monetary Policy Seasonal?
Richard K. Crump and David O. Lucca
Many economic time series display periodic and predictable patterns within each calendar year, generally referred to as seasonal effects. For example, retail sales tend to be higher in December than in other months. These patterns are well-known to economists, who apply statistical filters to remove seasonal effects so that the resulting series are more easily comparable across months. Because policy decisions are based on seasonally adjusted series, we wouldn’t expect the decisions to exhibit any seasonal behavior. Yet, in this post we find that the Federal Reserve has been much more likely to lower interest rates in the first month of each quarter over the past twenty-five years. While some of this seasonality is a result of meeting scheduling, a large seasonal component remains unexplained.
Posted by Blog Author at 7:00 AM in Fed Funds, FOMC, Macroecon, Monetary Policy | Permalink | Comments (0)July 11, 2012
The Puzzling Pre-FOMC Announcement “Drift”
David O. Lucca and Emanuel Moench
For many years, economists have struggled to explain the “equity premium puzzle”—the fact that the average return on stocks is larger than what would be expected to compensate for their riskiness. In this post, which draws on our recent New York Fed staff report, we deepen the puzzle further. We show that since 1994, more than 80 percent of the equity premium on U.S. stocks has been earned over the twenty-four hours preceding scheduled Federal Open Market Committee (FOMC) announcements (which occur only eight times a year)—a phenomenon we call the pre-FOMC announcement “drift.”
Continue reading "The Puzzling Pre-FOMC Announcement “Drift”" »
Posted by Blog Author at 7:00 AM in Exchange Rates, Expectations, Financial Markets, FOMC, Monetary Policy, Stocks | Permalink | Comments (9)About the BlogLiberty Street Economics features insight and analysis from New York Fed economists working at the intersection of research and policy. Launched in 2011, the blog takes its name from the Bank’s headquarters at 33 Liberty Street in Manhattan’s Financial District.
The editors are Michael Fleming, Andrew Haughwout, Thomas Klitgaard, and Asani Sarkar, all economists in the Bank’s Research Group.
The views expressed are those of the authors, and do not necessarily reflect the position of the New York Fed or the Federal Reserve System.
Economic Research Tracker
Liberty Street Economics is now available on the iPhone® and iPad® and can be customized by economic research topic or economist.
View by Topicbank capital balance of payments banks central bank corporate finance credit crisis crisis chronicles cryptocurrencies current account dealers demographics dodd-frank dsge economic history education employment euro area exchange rates expectations exports fed funds federal reserve financial institutions financial intermediation financial markets fire sale fiscal policy fomc forecasting foreclosure great recession hey, economist! high frequency trading historical echoes household household finance housing human capital inequality inflation international economics labor economics labor market lender of last resort liquidity macroecon monetary policy mortgages new jersey new york new york city panic phillips curve puerto rico recession regional analysis regulation repo sandy stocks student loans systemic risk tariffs treasury unemployment wagesMost Viewed
Last 12 MonthsUseful LinksComment GuidelinesWe encourage your comments and queries on our posts and will publish them (below the post) subject to the following guidelines:Please be brief: Comments are limited to 1500 characters.Please be quick: Comments submitted after COB on Friday will not be published until Monday morning.Please be aware: Comments submitted shortly before or during the FOMC blackout may not be published until after the blackout.Please be on-topic and patient: Comments are moderated and will not appear until they have been reviewed to ensure that they are substantive and clearly related to the topic of the post. We reserve the right not to post any comment, and will not post comments that are abusive, harassing, obscene, or commercial in nature. No notice will be given regarding whether a submission will or will not be posted.Disclosure PolicyThe LSE editors ask authors submitting a post to the blog to confirm that they have no conflicts of interest as defined by the American Economic Association in its Disclosure Policy. If an author has sources of financial support or other interests that could be perceived as influencing the research presented in the post, we disclose that fact in a statement prepared by the author and appended to the author information at the end of the post. If the author has no such interests to disclose, no statement is provided. Note, however, that we do indicate in all cases if a data vendor or other party has a right to review a post.Archives - Financial Services
RSS Feed