Richmond Fed tries to bridge gap between rules and discretion
Economist presents research urging Fed to be more explicit about its strategy
The Federal Reserve Bank of Richmond has lent support to the idea of setting monetary policy on the basis of a more transparent strategy, with a senior economist outlining a framework that steers between rules- and discretion-based approaches.
The Richmond Fed published a paper by Robert Hetzel on September 12, outlining a method for the Fed to be more explicit and systematic in setting policy, without ceding control completely to a mechanical rule.
Hetzel's idea is for the Federal Open Market
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